Reliance Communications Limited (RCOM) AI Stock Analysis

• Market Cap: ₹3.87B
• Dividend Yield: N/A
• Average Volume (3M): 1.05M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.78
• Revenue Growth: -9.21%
• EPS Growth: -30.01%
• Country: IN
• Employees: 464
• Sector: Services
• Sector Strength: N/A
• Industry: Telecommunications Services
• EPS (TTM): -9.33
• Shares Outstanding: 2,765,533,000
• 10 Day Avg. Volume: 724,309
• 30 Day Avg. Volume: 1,047,701
• PEG Ratio: >-0.01
• Price to Book (P/B): >-0.01
• Price to Sales (P/S): 1.13
• P/FCF Ratio: 406.10
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹1.50
• Price Target Upside: 7.14% Upside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 1

• Rating: 39 Underperform
• Price Target: ₹1.50 ▲(7.14% Upside)

Reliance Communications Limited's overall stock score is primarily impacted by its poor financial performance, characterized by declining revenues, high leverage, and negative equity. The technical analysis further supports a bearish outlook, with the stock trading below key moving averages and negative market momentum. Valuation metrics are also unfavorable, with a negative P/E ratio and no dividend yield. These factors collectively suggest a high-risk investment with significant challenges ahead.

Reliance Communications Limited Business Overview & Revenue Model

Company Description

Reliance Communications Limited provides enterprise voice, data, video, and IT infrastructure solutions to enterprises, over-the-top (OTT) players, and network operators in India and internationally. The company offers business Internet, network, cloud networking, data center, enterprise voice, cloud telephony, and access number services; and collaboration services, which include audio and Web conferencing, as well as voice and various value-added wholesaling services for carriers and service providers. It also provides colocation, IT infrastructure and connectivity, and managed services. The company was formerly known as Reliance Communication Ventures Limited and changed its name to Reliance Communications Limited in June 2006. Reliance Communications Limited was incorporated in 2004 and is based in Navi Mumbai, India.

How the Company Makes Money

Reliance Communications generates revenue primarily through its mobile services, which include voice calls, SMS, and data plans for individual consumers. Additionally, the company earns income from broadband services and enterprise solutions, providing connectivity and data services to businesses. Key revenue streams include subscription fees from mobile users, one-time charges for broadband installations, and recurring charges for enterprise contracts. RCOM also benefits from partnerships with various technology and infrastructure providers, enhancing its service offerings and expanding its customer base. Factors contributing to its earnings include market penetration, competitive pricing strategies, and investments in network infrastructure to improve service quality.

Reliance Communications Limited Financial Statement Overview

Summary

Reliance Communications Limited is facing significant financial challenges. The company has declining revenues, poor profitability, and high leverage. The negative equity and high debt levels pose serious risks to financial stability. While there are slight improvements in cash flow, they are insufficient to offset the broader financial difficulties.

Income Statement

The income statement metrics reveal a challenging financial situation. The company has experienced significant declines in revenue, with a 6.53% decrease from 2024 to 2025, and consistently negative net income over the years. Gross profit margins have also deteriorated. Further, EBIT and EBITDA margins are negative, reflecting high operational costs relative to revenue. This indicates substantial profitability challenges and operational inefficiencies.

Balance Sheet

The balance sheet shows considerable financial distress. The company has negative stockholders' equity, indicating that liabilities far exceed assets, and a very high debt-to-equity ratio, which is concerning. The equity ratio is negative, highlighting a lack of financial stability and significant leverage. These factors suggest a high risk of financial instability.

Cash Flow

Cash flow metrics show modest improvement in 2025 with a positive operating cash flow, but free cash flow remains limited. The free cash flow to net income ratio suggests liquidity issues, as cash flows do not cover net losses effectively. There is some improvement from previous years, but overall cash flow generation is weak and inconsistent, indicating potential liquidity challenges.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.45B	3.58B	3.83B	4.79B	5.56B	7.60B
Gross Profit	1.22B	590.00M	1.59B	2.54B	-310.00M	-470.00M
EBITDA	-330.00M	-190.00M	870.00M	-990.00M	-340.00M	20.00M
Net Income	-97.27B	-93.89B	-72.12B	-144.99B	-66.20B	-57.91B
Balance Sheet
Total Assets	0.00	364.25B	365.54B	367.68B	475.57B	478.26B
Cash, Cash Equivalents and Short-Term Investments	5.58B	4.39B	3.86B	3.89B	8.69B	8.26B
Total Debt	0.00	472.16B	472.31B	472.61B	455.72B	455.76B
Total Liabilities	914.96B	1.28T	1.19T	1.12T	1.08T	1.01T
Stockholders Equity	-914.96B	-914.90B	-821.30B	-748.91B	-605.73B	-539.06B
Cash Flow
Free Cash Flow	0.00	10.00M	-390.00M	-640.00M	840.00M	3.19B
Operating Cash Flow	0.00	10.00M	-390.00M	-640.00M	1.19B	3.28B
Investing Cash Flow	0.00	-30.00M	650.00M	80.00M	-2.98B	-60.00M
Financing Cash Flow	0.00	-90.00M	-380.00M	-220.00M	-510.00M	-550.00M

Reliance Communications Limited Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:RCOM, the sentiment is Negative. The current price of 1.4 is below the 20-day moving average (MA) of 1.41, below the 50-day MA of 1.51, and below the 200-day MA of 1.62, indicating a bearish trend. The MACD of -0.02 indicates Negative momentum. The RSI at 46.66 is Neutral, neither overbought nor oversold. The STOCH value of 27.30 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:RCOM.

Reliance Communications Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	55 Neutral	$13.29B	17.42	10.03%	0.93%	7.13%	-12.93%
SHRADHA	55 Neutral	₹3.56B	15.00	―	0.98%	-12.08%	-18.45%
PVSL	50 Neutral	₹10.53B	33.91	―	0.34%	-2.46%	-129.92%
GTL	48 Neutral	₹1.44B	1.09	―	―	12.65%	-102.59%
RCOM	39 Underperform	₹3.87B	―	―	―	-9.21%	-30.01%

Reliance Communications Limited Corporate Events

Reliance Communications Discloses Financial Indebtedness Amid Insolvency Proceedings

Reliance Communications Limited has disclosed its financial status in compliance with a SEBI circular, revealing a total financial indebtedness of Rs 40,413 crore, with defaults amounting to Rs 28,826 crore. The company is under corporate insolvency resolution, and its financial challenges highlight significant implications for stakeholders, as all outstanding amounts are considered in default.