Reliance Industries Ltd (RIL) was set to emerge as the largest beneficiary of China’s efforts to curb overcapacity across industries, according to a note by Morgan Stanley. The brokerage said RIL’s own restructuring efforts and China’s focus on “anti-involution” — measures aimed at reducing cutthroat competition and excess capacity — together create a powerful growth opportunity for the conglomerate.
Morgan Stanley retained its overweight rating on Reliance and raised its 12-month price target to ₹1,701 from ₹1,602, signalling a potential upside of 24.4 percent from Tuesday’s close. The brokerage highlighted that the market was assigning “near zero value” to the company’s new energy and artificial intelligence (AI) investments, and pricing in only limited upside in its fast-moving consumer goods (FMCG) business.
China’s Anti-Involution Measures to Boost Solar and Energy Business
Morgan Stanley’s analysts, led by Mayank Maheshwari, said Reliance was the biggest beneficiary of China’s anti-involution policies across energy and solar supply chains. The note pointed out that Reliance was creating a fully integrated solar supply chain in India at a time when Chinese producers were scaling back polysilicon output. This structural shift could lower Reliance’s energy costs by as much as 40 percent by 2030 and increase new-energy earnings contribution to 13 percent by 2027.
The brokerage also said that China’s efforts to rationalise capacity in the solar sector were likely to support pricing for global players such as Reliance. It estimated that the combined impact of China’s measures and Reliance’s own restructuring could add nearly $20 billion in net asset value for the company and boost its earnings forecast for FY28 by 17 percent.
Green Energy Plans and Jio IPO Timeline
At its 48th annual general meeting (AGM) held on August 29, Chairman Mukesh Ambani and director Anant Ambani laid out an ambitious green energy roadmap, which they said would create the world’s most integrated new energy ecosystem. “Hydrocarbons will remain vital for India for several years. Our strategy is clear: excel in traditional energy while building the system of the future,” Ambani said during the virtual AGM.
The company also reiterated its commitment to doubling its earnings before interest, taxes, depreciation and amortisation (EBITDA), a goal first announced in 2022. In addition, Ambani confirmed plans to list Jio through an initial public offering (IPO) in the first half of 2026. Jio, which recently crossed 500 million subscribers, was expected to deliver value creation on par with global peers, he said.
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