Reliance Retail Pledges to Pass on Entire GST Benefit to Customers

Reliance Retail has stated that it will pass on the entire benefit of the new GST regime to its customers. The company is part of the Reliance Industries group, which operates in six areas, including refining of petroleum products, distribution of consumer products, digital services, and exploration and production of crude oil and natural gas.

Reliance Industries, a conglomerate operating in six diverse areas including refining of petroleum products, distribution of consumer products, digital services, and exploration and production of crude oil and natural gas, is poised to significantly benefit from China's efforts to curb overcapacity in key sectors. According to a report by Morgan Stanley [1], Reliance Industries is expected to be the largest beneficiary of China's 'anti-involution' policies, which aim to counter cutthroat competition yielding little return.

Reliance Industries is undergoing internal restructuring and has made strategic moves in solar energy and consumer businesses, which align with China's anti-involution drive. The company's creation of a fully integrated solar supply chain in India, coupled with China's reduction of polysilicon output due to overcapacity pressures, is set to substantially reduce Reliance's energy costs by up to 40% by 2030. This shift could push new-energy earnings contributions to 13% by 2027 [1].

At its 48th Annual General Meeting (AGM) on August 29, Reliance Industries set out an expansive green energy roadmap. The company aims to construct the world's most integrated new energy ecosystem, reflecting its intent to maintain strength in its Oil-to-Chemicals (O2C) operations while stepping up renewable investments [1].

Morgan Stanley analysts estimate that anti-involution efforts in both China and Reliance could add $20 billion in net asset value and increase the company's earnings forecast for fiscal 2028 by 17% [1]. The brokerage has kept its overweight rating on Reliance and raised its 12-month price target to ₹1,701 from ₹1,602, pointing to a potential 26% upside from Monday’s closing level [1].

Reliance Retail, part of the Reliance Industries group, has also announced that it will pass on the entire benefit of the new GST regime to its customers, further enhancing its competitive edge in the retail sector.

References:
[1] https://m.economictimes.com/news/company/corporate-trends/ambanis-reliance-seen-as-big-gainer-from-chinas-push-to-curb-price-wars-morgan-stanley-says/articleshow/123647035.cms