Shares of index heavyweight Reliance Industries Ltd (RIL) recently plunged to a 52-week low of Rs 1,160.40, marking a significant 25.58% correction on a year-to-date basis. The substantial decline has prompted investors and analysts to scrutinize the underlying causes.
Understanding RIL's Recent Stock Performance
The downturn in RIL's stock, observed as of October 9, 2026, reflects a confluence of broader market dynamics and specific company-related factors. Experts have identified five primary reasons contributing to this significant Reliance Industries stock decline.
Five Factors Behind Reliance Industries' Stock Decline
1. Broader Market Correction
According to G Chokkalingam, founder of Equinomics Research, the slide in RIL shares aligns with a wider market sell-off. Domestic benchmark indices have corrected approximately 15% so far in calendar year 2026, creating a challenging environment for even large-cap stocks like RIL.
2. Muted Oil and Gas Performance
Chokkalingam also highlighted concerns over subdued performance within RIL's oil and gas segment. The ongoing crisis in West Asia is anticipated to weigh on the company's profitability in this sector, impacting overall earnings.
3. Rising Depreciation Charges
Another factor cited by Chokkalingam is the potential for a steep increase in depreciation charges. Reliance Industries has undertaken substantial capital expenditure in recent periods, and the financial impact of these investments in terms of depreciation could be a concern for investors who have not yet seen the full benefits of expanded capacities reflected in profits.
4. Anticipated Jio Platforms IPO
Investors are closely monitoring the upcoming initial public offering (IPO) of Jio Platforms, RIL's digital technology subsidiary, which is expected this month. A clearer separation of Jio's valuation through its listing could help investors better assess Reliance's remaining businesses. Chokkalingam suggests that this listing might drive a rerating as the market begins to value the underlying businesses more distinctly.
5. Q2 FY27 Earnings Expectations
The market is also keenly awaiting RIL's September quarter (Q2 FY27) results. Nuvama Institutional Equities projects a 17% year-on-year (YoY) growth in EBITDA for Q2 FY27, an increase from its initial assessment, primarily driven by expanding middle distillate crack spreads. Nuvama anticipates a 38% YoY growth in O2C EBITDA and a 16% rise in digital EBITDA. However, these gains may be partially offset by an expected 6% YoY decline in oil and gas (O&G) EBITDA and a 1% fall in retail EBITDA due to a higher comparative base.
Despite the recent stock performance, Nuvama has maintained a 'Buy' rating on Reliance Industries, setting a 12-month target price of Rs 1,766.