Overview
- Reliance shares rose about 3% on March 5 as notes from Jefferies and JM Financial highlighted benefits from refined‑product tightness tied to Middle East risks and China export buzz.
- Jefferies estimated a Strait of Hormuz blockade could remove roughly 2–3 million barrels per day of refined products and said each $1 per barrel rise in refining margin adds about $500 million to Reliance’s annualized EBITDA.
- JM Financial reiterated a Buy with a Rs 1,730 target, calling the recent decline overdone and attributing pressure largely to foreign investor selling.
- Brokerages pointed to very high recent diesel cracks and Reliance’s high diesel yield of about 40–50%, while noting petrochemical margins are cushioned by a feedstock mix less tied to naphtha.
- Caveats include the potential reintroduction of Indian windfall taxes and the possibility that elevated diesel spreads prove short‑lived, with investors also watching the expected Jio IPO and any post‑listing tariff moves.