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Goldman Sachs has set a 12 month price target of Rs 3,200 for Reliance Industries Limited (RIL) stock with a 22 per cent upside.

"We see RIL as a unique energy transition story. For RIL, strong cashflow generation in the best in class old energy business (low cost structure and highest complexity) can fund the capex of the New Energy business and in turn drive one of the fastest and most profitable net zero transitions by 2035 amongst large energy companies, on our analysis," Goldman Sachs said.

RIL is adopting a manufacturing approach to net zero-emissions with a hyper integrated model spanning solar, battery and hydrogen and a focus on net zero supply chain (already spent $1.5 billion to acquire technologies across the solar, battery and hydrogen ecosystems).

"We recently revised up FY23/24 EBITDA by 11 per cent/5 per cent driven entirely by RIL's old energy business such as Refining and Gas. We see refining tailwinds to sustain given improved supply demand from closures, jet fuel demand recovery ahead, lower Chinese exports, low inventory and supply disruption. With rising penetration and market share wins ahead in consumer businesses (telecom tech and retail), we see the medium term growth story remaining intact as well," the report said.

Overall we expect strong earnings growth of 35 per cent CAGR in FY21-24E, with our FY23/24E earnings 26 per cent/26 per cent above consensus. For 4QFY22 we forecast 7 per cent QoQ growth led by refining and telecom division with further acceleration ahead, Goldman Sachs said.