Shares of Reliance Industries Ltd (RIL) remained in focus on Friday ahead of Mukesh Ambani-led conglomerate’s March quarter earnings set to be announced post market hours today. The share price of the country’s most valued firm moved in a narrow range with a positive bias, in sync with the broader market, which has witnessed lackluster trade so far.

RIL shares opened marginally higher at ₹2,348.05 against the previous closing price of ₹2,345.70 on the BSE. In the first half of trade so far, the index heavyweight rose as much as 0.4% to hit a high of ₹2,355.40, while it touched a low of ₹2,338. On the volume front, as many as 0.35 lakh shares changed hands over the counter on the BSE compared with a two-week average volume of 1.61 lakh scrips. The market capitalisation stood at ₹15.87 lakh crore.

At the current price levels, RIL shares trade 18% lower than its 52-week high and 8% higher than its 52-week low. The blue chip stock touched its 52-week high of ₹2,855 on April 29, 2022, and its 52-week low of ₹2,180 on March 20, 2023.

Reliance shares have underperformed the BSE benchmark Sensex in the last one year, primarily due to concerns over high capex and resultant rising debt. The counter has given a negative return of 13.6% in the last one year as against 4.5% rise in the Sensex. In the last six months, the stock has tumbled 5% compared with 0.5% growth in the Sensex, whereas it shed 3.9% in three months versus 1.7% fall in the Sensex. In the calendar year, RIL shares have lost nearly 8%, while it climbed over 6% in a month.

What to expect from RIL Q4 results:

The telecom-to-oil conglomerate is expected to report single-digit growth in its top and bottom lines, while consolidated Earnings before Interest, Taxes, Depreciation and Amortisation (EBITDA) is seen growing double-digit year-on-year in the March quarter of 2023.

Domestic brokerage Sharekhan sees Reliance's consolidated profit growing by 4.7% year-on-year at ₹16,960 crore. The sales is expected to rise 3.1% to ₹ 2,13,734 crore, while operating profit margin is projected to grow 16.9%, up 176 basis points YoY.

Motilal Oswal Securities has projected a 17% growth in the operating profit, on the back of double-digit growth in the oil-to-chemicals business.

Nomura India expects RIL's retail business to clock gross revenue of ₹70,710 crore, up 22% YoY and Ebit margin of 6.9%. The revenue for Jio, the telecom arm of RIL, is pegged at ₹23,430 crore, up 12% YoY.

JM Financial expects Jio’s ARPU (average revenue per user) to rise at 10% CAGR over FY23-28 as ARPU is on a structural uptrend given the consolidated industry structure, future investment needs, and the need to avoid a duopoly market. “Our calculation suggests that the industry needs an ARPU of ₹256-285 in the next 3-5 years for a pre-tax RoCE of 12-15%, considering future investment needs,” it said in a report.

The agency sees strong growth momentum to continue in the company’s retail business as RIL is driving omni-channel capabilities across segments and taking newer initiatives (foray into FMCG, acquisition of Metro) to build a large portfolio of brands and strengthen the supply chain. Despite being contingent on global macros, RIL’s O2C business earnings are also relatively well-placed, it said.

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