We are comfortable with Reliance’s large diversified scale of operations and dominant presence in various key sectors (refining, petrochemicals, retail and telecom), which allows for earnings resilience.

We believe a lackluster oils-to-chemicals outlook is well mitigated by strong outlooks for telecom and retail.

Plans to ramp up its renewable energy business could provide the next leg of growth and improve ESG perception.

Reliance incurs significant capex that has weighed on free cash flow generation, though we acknowledge its historically prudent financial management and robust credit metrics that provide ample elbowroom for some credit profile deterioration.

Reliance’s O2C (oil-to chemicals) margins remain under pressure from global tariff-led growth slowdown concerns and persisting oversupply conditions in China.

Reliance incurs significant capex at historically high levels, particularly from continued investments into its O2C, retail, and nascent renewables businesses. This has weighed on its free cash flow generation, though we take comfort in Reliance’s historically prudent financial management and robust credit metrics.

Reliance faces key-person risk; 65-year old Chairman Mukesh Ambani has begun to hand over the reins of the company’s different business divisions to his children.