Why is Reliance Industries stock surging today?

Reliance Industries stock experienced a significant surge of 6.2% on Monday, reaching a price of ₹1,237.4, marking its largest single-day gain in nine months. This surge was driven by the company's record quarterly profit, which exceeded market expectations, and a 40% year-on-year increase in consolidated net profit attributable to ₹25,548 crore.

Total revenue climbed by 27.8% to ₹3,62,268 crore, while EBITDA grew by 23.9% to ₹62,409 crore. The record profit was primarily fueled by the oil-to-chemicals (O2C) segment, which benefited from improved global fuel margins. Additionally, Jio's digital services arm contributed to steady growth, with average revenue per user increasing to ₹219 from ₹216 in the prior quarter and a net subscriber addition of 9 million.

Analysts also reacted positively, with Nuvama Institutional Equities maintaining a buy rating and Equirus issuing a Long rating with a target price of ₹1,537. Despite the retail segment performing relatively weaker, the strong performance in O2C and telecom sectors more than compensated, leading to an overall positive outlook. Management reiterated that the new energy business is expected to start contributing to earnings from FY28.

The broader Indian equity market provided a supportive backdrop, with the BSE Sensex and Nifty 50 both showing gains. Reliance's rally outpaced the oil sector's rise by around 2 percentage points, indicating that the stock's movement was more company-specific than influenced by broader market trends. Reliance Industries' stock, which had been near its 52-week low, rebounded strongly on the earnings news, though it is still below its 52-week high, suggesting potential for further recovery if the momentum continues.