Reliance‘s share price was volatile on Saturday morning as the company’s earnings missed most estimates.

What Happened: Reliance Industries reported an 11% year-on-year rise in net profit for the December quarter, reaching ₹19,641 crore compared to ₹17,706 crore in the same quarter the previous year. The profit growth was affected by weakness in the energy segment, offsetting steady profit growth in RIL's retail and telecom businesses.

The gross revenue for the quarter increased by 3.2% to ₹2.48 lakh crore, up from ₹2.40 lakh crore in the corresponding period the previous year. RIL restated figures for the year-ago period to account for the demerger of the financial services business.

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The quarterly earnings were impacted by an increased cost of stock-in-trade, which rose by ₹7,000 crore sequentially to ₹57,898 crore. Additionally, higher employee costs, finance costs, and depreciation contributed to the rise in expenses. Planned maintenance and inspection shutdowns also impacted yields and profitability during the quarter, as per the conglomerate.

Analyst Reactions: Morgan Stanley maintained its “overweight” rating for the stock with a price target of ₹2,821. The research firm pointed out that Reliance reported the slowest investment capex in the last two years.

CLSA also maintained its “buy” rating for the stock with a price target of ₹3,060. The brokerage firm said that the oil-to-telecom giant’s EBITDA was in line with expectations.

Citi downgraded the stock rating from “buy” to “neutral” but raised the target price to ₹2,910 from ₹2,600. The brokerage said that the downgrade was on account of the risk-reward ratio turning balanced.

Dolat Capital also maintained its “buy” rating for the stock with a price target of ₹3,010. The brokerage said that the company’s EBITDA was in line with estimates and PAT beat estimates by 2%.

Emkay Global maintained its “add” rating for the stock but raised the price target to ₹2,950. The brokerage said that the conglomerate’s earnings were largely in line.

Price Action: Reliance’s share price was down 0.04% to trade at ₹2,734 as the markets opened on Saturday.

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