Reliance Industries Ltd.

At the same time, RIL's digital segment is exposed to stiff competition and regulations in India's telecom market. Following the debut of Jio in fiscal 2016, the country's telecom market has undergone a series of market consolidation due to heavy losses and low margins arising from price competition. India now has just three private telecom operators, from nine previously, with Jio holding the largest market share of wireless subscribers as of end-2020. The stable outlook reflects our expectation that RIL's strengthening cash flows amid disciplined spending will improve its financial profile over the next 12-24 months. We could lower the rating if we expect RIL's debt-to-EBITDA ratio to exceed 2.5x. This could happen if: (1) the company's capital expenditure (capex)

...We expect Reliance Industries Ltd. (RIL) to maintain its leadership position in Asia's oil refining industry. RIL is one of the largest and most complex refiners globally. Its refineries have a processing capacity of 1.24 million barrels per day (bpd), and the Jamnagar site's complexity index of 21.1x is well above the average. This, together with the high integration of its petrochemical facilities and refining business, has enabled RIL to maintain more stable and higher profitability in the O2C (oil to chemicals) segment than its peers. Our base case assumes RIL's total EBITDA margins will remain in the mid-teens range over fiscals 2022 and 2023 (year ending March 31). RIL's overall operations should remain resilient and recover gradually from fiscal 2022. We anticipate changes to consumer behavior with increasing digitization of shopping and work-from-home arrangements will support RIL's operational outlook. Coupled with some recovery from the O2C segment on last year's low base effect,...

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