Investors have been patient, will Mukesh Ambani reward them?

India’s most valuable company, Reliance, will announce its financial results for the second quarter of fiscal 2026 on Friday.

Consolidated profit and EBITDA growth have been muted over the last eight quarters, with several consecutive declines recorded during this period. The company’s net profit increased ₹16,011 crore in the first quarter of FY24. ₹26,994 crore in the first quarter of this financial year. But a significant increase ₹8,924 crore in the first quarter of FY26 came from the sale of its stake in Asian Paints, according to Bloomberg data. Apart from this one-time gain, its profits grew at a compound annual rate of 6%. During this period, EBITDA also grew at a compound annual growth rate of 6%.

Now, investors will see better earnings growth as 5G-related capital spending in the telecommunications sector ends, retail restructuring completes with the closure of unprofitable locations, and margins in the oil business bottom out.

There are some headwinds that will help Reliance. That is, a sharp increase in the so-called diesel cracks in September, a steady increase in the subscriber base at Jio and an increase in the average revenue the company earns from each Jio subscriber and each retail store.

Diesel crack is the difference between the cost of crude oil and the price of diesel, which is an indicator of how profitable refining is.

There are some headwinds, too: an expected decline in Russian purchases of cheap crude and volatility in U.S. tariffs.

Investors also expect material updates on the company’s growth drivers over the next decade: its fast-moving consumer goods (FMCG) business and its green energy giga complex in Jamnagar, which will produce everything from solar panels to renewable electricity and then use that power to produce green hydrogen and run data centres. Beyond the fancy headlines, investors will want to know where these projects stand and a clear timeline for when they will be operational and start contributing to earnings.

“Confidence hasn’t really rewarded investors and it’s time they did that,” said Sudip Bandyopadhyay, group chairman of financial services firm Inditrade Capital Ltd.

Here are the top factors to note regarding Reliance Industries’ Q2 earnings on Friday:

Gross refinery margins

Reliance’s O2C business, which converts crude oil into fuel and other chemicals, was the main driver of earnings until its telecom and retail business started contributing meaningfully to consolidated EBITDA in the last few years. Telecoms and retail now account for just over half of consolidated EBITDA.

However, gross refining margins of the O2C business still remain a key metric over the last few quarters; weak O2C margins offset growth in telecommunications and retail. Gross refining margins (GRM) in the industry increased to around 18% in 2022, when the Covid-19 epidemic was intense. It has fallen sharply since then, falling below 2% in January this year, according to analysis by JP Morgan. GRM rose nearly 10% in September, according to the brokerage firm, which bodes well for the company’s second-quarter earnings.

The rise in GRM comes after diesel cracks rose from about $16 per barrel in August to about $20 per barrel in September, according to JP Morgan. This September, GRM will offset the decline in August and bring average margins for the quarter to the same level as the previous three months. JP Morgan analysts estimate that every $1 per barrel increase in GRM translates into a 2% increase in the company’s consolidated EBITDA and a 4% increase in Reliance Industries’ net profit.

The outlook for Russia’s oil purchases will also be important. “With the recent rising concerns, we believe Indian refineries will replace Russian crude oil with more expensive crude oils. This could lead to an increase in both oil prices and benchmark premiums,” Kotak Institutional Equities analysts noted on August 24.

Jio ARPU lists updates

Reliance Jio is expected to add around 5 million subscribers in the July-September quarter, which will take the company to cross 500 million subscribers. Average revenue per user (ARPU), an important metric for the telecom industry, is also expected to increase by 1.5%, respectively. ₹212 per month, according to analysts at Centrum, a brokerage firm.

With the bulk of the capital expenditure for the 5G rollout completed in the last financial year, with a rise in ARPU and subscribers and an extra day compared to the previous quarter, Reliance Industries’ telecom arm is expected to grow 2.5% sequentially, according to analysts at JM Financial, another brokerage firm.

“On the telecom side, we expect the street to be responsive to updates on ARPU growth and guidance on expected tariff increases,” said Nirav Karkera, Head of Research at asset management platform Fisdom.

Investors will also be looking for further updates on the company’s plan to list Jio Platforms, which houses its telecommunications business, following the announcement made on August 29 at the company’s annual general meeting. At its AGM, the company said it would expand into Africa ahead of Jio’s IPO next year.

“Any update in Jio listing will be top on investors’ agenda,” said Inditrad Capital’s Bandyopadhyay.

Outlook for FMCG expansion

Reliance says FMCG business is in overdrive ₹11,000 crore in revenue in FY25 and touted it as the growth leader for the next decade at the AGM in August. The company targets ₹Planning to generate 1 trillion revenue from the segment and planning to invest ₹40,000 crore over the next three years to develop integrated food production facilities across India.

“Announcements regarding the FMCG business will also be important. They said it has already reached the size of Dabur,” Bandyopadhyay said. he said. Revenue of FMCG giant Dabur ₹12,563 crore in FY25.

Margins from the broader retail sector will also be crucial to overall EBITDA growth. “From a retail perspective, while the outlook is positive in the short term due to improved margins along with store expansion and higher penetration, guidance on growth expectations for the festive season and roadmap for further improvement in margins will be closely scrutinized,” Karkera said.

New energy roadmap

Reliance’s biggest bet for the next decade is the clean energy mega complex in Jamnagar. In the statement made at the company’s General Assembly meeting, it was stated that the construction of Dhirubhai Ambani Giga Energy Complex in Jamnagar is progressing at a dizzying pace.

However, the project is running behind the previously stated timelines. For example, the start of the planned battery cell manufacturing facility at the site has been rescheduled to 2026, marking further delays from the already postponed 2025 start date.

Meanwhile, although the 10-gigawatt-per-year solar cell facility has successfully assembled 200 megawatt modules, the official launch of full-scale cell production is still an unspecified number of quarters away. This distinction is critical because solar cells, which are significantly more complicated and complex to manufacture, are the key components used in assembling modules.

“O2C is in a sweet spot, but further developments are expected on the energy transition side of the business, particularly around guidance on implementation and monetization roadmap,” Fisdom’s Karkera said. he said. “This type of roadmap clarity around data center and AI efforts on the digital side is a growing segment investors can be expected to pay attention to.”