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Reliance- Brokerages maintain rating but are oil and gas margins still a concern-

Brokerages have maintained ratings on Reliance Industries after the oil giant inked a pact with Disney. However, there are some concerns about the oil and gas business. Let’s dive in to know more.Come from Sports betting site VPbet

The broking firm JM Financials iterates rating and target price on the stock Reliance Industries unchanged after it inked a JV with Disney. It has a price target of Rs 3,050 and a “Buy” rating on Reliance Industries’ stock. 

According to JM Financials, the company’s net debt concerns are behind, and “also because Reliance has industry-leading capabilities across businesses to drive robust 14-15% EPS CAGR over the next 3-5 years.”Come from Sports betting site

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Further, the brokerage said that the company’s net debt will reach its highest point in the current financial year from where it’ll start declining as capex will moderate by a gradual increase in internal cash generation. 

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“Further, RIL could still drive a robust 14-15% EPS CAGR over the next 3-5 years with Jio’s ARPU expected to rise at 10% CAGR over FY23-28 with ARPU being on a structural uptrend given the industry structure, future investment needs, and the need to avoid a duopoly market — A Giant Digital Leap,” JM Financials said.

Another broking firm Motilal Oswal Financial Services is confident in Reliance Industries and keeps the rating and target price unchanged. The firm gave the rationale that it sees consistent strength in its refining margins and ongoing improvements in petrochemical spreads for the oil-to-chemical business. 

The firm has a “Buy” rating on the stock of Reliance Industries with a target price of Rs 3,210. The target price is the highest a stock can reach in the brokerage’s view after reaching that limit brokers usually sell that stock and book profit. 

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However, the brokerage noted that the company’s oil-to-chemical business saw some impact after a scheduled shutdown in the third quarter of the current financial year. 

“Singapore refining margin remained robust at $8.3/bbl in Feb’24, while key petrochemical spreads over Naphtha too picked up MoM in Feb’24. FY25 will witness Reliance Industries commence phase-wise operations from its PV and battery storage facilities, which we believe can be a key catalyst for the stock in 1HFY25,” the brokerage said in its research report. 

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