India Retail: Reliance Retail: Q1 Margins soften amid Digital build-out; FMCG ramp-up underway

Research evidence excerpt

India Retail: Reliance Retail: Q1 Margins soften amid Digital build-out; FMCG ramp-up underway

J P M O R G A N Asia Pacific Equity Research

19 July 2026

India Retail

Reliance Retail: Q1 Margins soften amid Digital build-

out; FMCG ramp-up underway

We attended RIL’s analyst meet post Q1FY27 earnings. Revenue growth of 12% (ex- Consumer, Retail, Media

ACRCPL) was broadly in-line with Grocery, Fashion & Lifestyle and Consumer Latika Chopra, CFA

Electronics clocked DD underlying growth (LFL: ~7%/4%/16%). Accelerated (91-22) 6157-3584

investments in quick delivery operations/infrastructure weighed on margins, leading latika.chopra@jpmorgan.com

to a 2% y/y EBITDA decline (below estimates). Net store addition was slower at +9 Himanshu Singh

with the overall retail space nearly flat q/q. The hyperlocal platform continues to scale (91-22) 6157-3610

across grocery, fashion and electronics (now servicing 5.5k+ pincodes), supporting himanshu.x6.singh@jpmorgan.com

strong customer acquisition and order growth; management remains focused on Saransh S Gokhale

improving repeat rates, increasing basket size and enhancing serviceability to drive (91-22) 6157 3578

saransh.gokhale@jpmchase.com

better profitability. Going forward, management expects improved revenue growth

Sanjay Mookimled by hyperlocal business scale up and targets 2x operating EBITDA in three years,

(91-22) 6157-3600

with FY27 focused on execution build-out, and scale-led operating leverage and sanjay.mookim@jpmorgan.com

monetization benefits accruing over FY28–29. RCPL (FMCG business) posted J.P. Morgan India Private Limited, J.P. Morgan

revenue of Rs86bn (~2x y/y) with rapid supply-chain and distribution buildout Tower, Santacruz(E), Mumbai - 400098, SEBI Registration: INH000001873, (91-22) 6157-3000.