Motilal Oswal Financial Services has reiterated its BUY recommendation on Reliance Industries , with a revised target price of Rs 1,765, implying 16% upside from current levels. The research house has substantially elevated its valuation of the company's emerging energy business to Rs 174 per share—a 50% jump from its earlier Rs 116 per share assessment. This recalibration reflects the conglomerate's ambitious 40GWh battery manufacturing facility in Jamnagar, slated for commissioning in early 2026, with a roadmap to scale capacity to 100GWh. The analysts project New Energy EBITDA will reach Rs 169 billion by FY30, representing approximately 7% of consolidated EBITDA. India's burgeoning battery energy storage systems market—projected to expand from 34.7GWh in FY27 to 236.2GWh by FY32—presents an unparalleled growth trajectory for the energy conglomerate's diversification ambitions.

RESHAPING THE VALUATION PARADIGM: A STRUCTURED OVERHAUL

The analytical methodology employed by Motilal Oswal Financial Services represents nothing short of a paradigm shift in how the investment community perceives Reliance Industries' intrinsic worth. Previously, the research establishment had compartmentalized the company's businesses into relatively siloed segments. Today, the recognition of battery manufacturing's transformative potential has necessitated a comprehensive revaluation architecture.

The refined valuation framework decomposes the enterprise into four distinct value pillars, each bearing its own valuation multiple and growth trajectory:

The critical inflection point in this revaluation stems from the recognition that battery manufacturing capacity, previously undervalued or entirely omitted from valuation frameworks, now constitutes approximately one-tenth of the company's intrinsic value. This reorientation reflects not merely an adjustment to existing estimates, but rather a fundamental recalibration of sectoral growth dynamics within India's renewable energy ecosystem.

THE JAMNAGAR COLOSSUS: ENGINEERING EXCELLENCE MEETS COMMERCIAL AMBITION

Situated in the industrial heartland of Gujarat, the Jamnagar battery giga-factory represents far more than conventional manufacturing infrastructure. It embodies Reliance's long-standing competitive advantage: the ability to conceive, finance, and execute projects of staggering technological complexity at scales that few organizations on the global stage can contemplate.

Capacity architecture and phased deployment: The initial production facility will commence operations in early calendar year 2026 with a 40-gigawatt-hour (GWh) per annum capacity. Construction progress has reached advanced stages, with production line equipment installation proceeding according to schedule. The facility's architecture permits modular capacity expansion to 100GWh, representing a trajectory of incremental scaling without wholesale manufacturing overhauls. This architectural sophistication positions Reliance to respond dynamically to demand fluctuations without incurring the prohibitive capital expenditures typically associated with greenfield facility expansions.

Captive consumption and backward integration: Initially, the output from this facility will be entirely consumed within Reliance's own ecosystem. Given the conglomerate's parallel commitment to install 100 gigawatts of renewable power generation capacity, the battery production will serve as an integrated energy storage solution alongside solar and wind assets. This vertical integration strategy creates multiple competitive advantages: reduced transportation costs, optimized inventory management, enhanced quality control, and guaranteed capacity utilization.

Motilal Oswal's analytical framework assumes minimal external sales until FY27, with capacity utilization gradually expanding to 75% by FY29 and reaching full capacity thereafter. The battery realization price—the revenue per kilowatt-hour of storage—is projected to decline from USD 70/kWh in FY27 to USD 55/kWh by FY30, reflecting the inexorable trajectory of battery cost compression witnessed across global markets.

INDIA'S ENERGY STORAGE IMPERATIVE: AN EXPANDING ADDRESSABLE MARKET

The fundamental demand catalysts for battery energy storage systems extend far beyond promotional rhetoric or climate commitments. They are embedded within the hard physics and economics of renewable energy integration, creating structurally persistent demand growth trajectories.

Capacity requirements and multi-decade outlooks: According to the National Electricity Plan issued by the Central Electricity Authority in 2023, India's total energy storage requirement stands at 82.4GWh in FY27, comprising 34.7GWh from battery systems. This requirement balloons to 411.4GWh by FY32—a compound annual growth rate exceeding 48%. Beyond this nearer-term horizon, by 2047, when India is targeted to achieve net-zero emissions status, the cumulative storage requirement reaches 2,380GWh, with 1,840GWh sourced from battery systems.

Annual battery demand under multiple scenarios: Beyond India's stated goal of achieving 500 gigawatts of renewable capacity by 2030, the country will require incremental capacity additions of 50-60 gigawatts annually. Assuming that 10-50% of this incremental capacity necessitates battery backup (dependent upon technology evolution and geographic considerations), annual battery demand ranges between 15-70 gigawatt-hours. This represents a conservative estimate that excludes emerging use cases, international export opportunities, and technological innovations that may expand addressable markets further.

Policy acceleration mechanisms: The Ministry of Power has issued binding directives requiring all Renewable Energy Implementation Agencies and state utilities to incorporate minimum two-hour co-located Energy Storage Systems, dimensioned at 10% of installed solar capacity, in future project tenders. Distribution licensees are similarly incentivized to mandate battery storage alongside rooftop solar installations. These policy mandates convert aspirational targets into contractual obligations, thereby transforming demand projections from speculative to highly probable.

NAVIGATING TECHNOLOGY TRAJECTORIES: LITHIUM-ION VERSUS EMERGING ALTERNATIVES

Reliance's strategic positioning within battery technology deserves close analytical attention, as it reveals management's sophisticated understanding of technology risk and competitive positioning.

Dual-track technology strategy: The company simultaneously pursues lithium-iron phosphate (LFP) solutions—recognized for lifecycle cost optimization—whilst accelerating commercialization of sodium-ion battery technology. Through its subsidiary Reliance New Energy Limited, the conglomerate acquired Faradion Ltd, a UK-based sodium-ion battery leader, for GBP 100 million in October 2024, with an additional GBP 25 million growth capital commitment.

Strategic significance: This technology duality positions Reliance to capture market share across divergent applications and price-points. Sodium-ion batteries—particularly suited for stationary grid-scale applications—can penetrate cost-sensitive segments where lithium-ion economics prove uncompetitive. Simultaneously, LFP capabilities address premium applications and export markets demanding superior performance specifications.

MARGIN EXPANSION AND PROFITABILITY ARCHITECTURE

The financial modeling undergirding Motilal Oswal's bull case rests upon explicitly stated EBITDA margin assumptions for the battery manufacturing segment:

Margin progression scenario: The analysts project EBITDA margins commencing at 5% in FY27, subsequently escalating to 15% in FY28, advancing to 17% in FY29, and stabilizing at 17% in FY30. This trajectory reflects the classic manufacturing economics of scale, wherein fixed cost amortization improves with volume expansion and manufacturing efficiency gains materialize through operational optimization. By FY30, the battery business alone is projected to contribute Rs 63.6 billion in EBITDA on an external sales basis, supplemented by the integrated solar cell-module manufacturing business.

Collectively, Motilal Oswal forecasts the New Energy business delivering Rs 169 billion in EBITDA by FY30, representing approximately 7% of consolidated FY28 EBITDA. For context, this magnitude would position the New Energy business as equivalent to an entire Fortune 500 standalone enterprise, underlining the transformative potential embedded within this strategic initiative.

INVESTMENT RATIONALE: SYNTHESIS AND VERDICT

Catalyst summary for investors: The research house identifies multiple near-term catalysts likely to re-rate the stock positively: (1) Government approval of an Approved List of Battery Manufacturers (ALBM) framework, analogous to existing solar module accreditation regimes, which could substantially limit Chinese battery imports and protect domestic manufacturers; (2) Implementation of mandatory energy storage requirements across state-level renewable energy tenders; (3) Successful commissioning of the 40GWh facility in early 2026, providing visibility into operational execution and cost structures; (4) Expansion of the renewable energy installation base, generating incremental captive demand for battery solutions.

Valuation multiples and implied returns: At the current market price of Rs 1,519 per share, Reliance trades at 27.3x FY26 estimated price-to-earnings and 13.1x EV/EBITDA. Motilal Oswal's target price of Rs 1,765 per share implies a 16% upside and represents a forward-looking P/E of 22.3x by FY28. This valuation premium remains defensible given the company's diversified cash flow streams, fortress balance sheet (Net Debt/Equity of 0.3x), and strategic positioning within India's energy transition.

Final assessment: Motilal Oswal Financial Services' reiteration of its BUY recommendation, coupled with material upward revision of the New Energy valuation, reflects institutional confidence in management's execution capability and the structural tailwinds supporting India's battery manufacturing ecosystem. For long-term investors, the convergence of technological advancement, policy supportiveness, and Reliance's integrated competitive advantages creates a compelling investment thesis. The 16% upside target should be contextualized within a multi-year horizon wherein New Energy contributions to consolidated earnings likely expand exponentially from present levels.

Current Market Metrics (as of November 23, 2025):

Current Market Price: Rs 1,519

Target Price: Rs 1,765

Upside Potential: +16%

Market Capitalization: Rs 20,555.1 billion / USD 232 billion

52-Week Range: Rs 1,115 – Rs 1,551