- Reliance Industries' shares have gained over 35% in past three months
- Analysts turned bullish on RIL after Jio's rapid customer acquisition
- TCS shares have underperformed the broader indices
Analysts have turned bullish on Reliance Industries since its announcement that it will charge Jio customers from April. In addition, many of Reliance Industries core petro-chemical projects will come online soon. On the other hand, IT stocks have struggled amid slower growth, uncertainty over H-1B visa regime and broader changes in the technological landscape.
Reliance Industries shares have been range-bound and had underperformed the broader indices for a long period of time as investors were concerned about the profitability of Jio in which Reliance Industries has already invested $25 billion.
With 72 million subscribers enrolling for the Jio's paid Prime membership till March 31, Reliance Jio will remain disruptive given its aspirations, investment banking firm Jefferies said in a report. Earlier, Jio had said that it had amassed 100 million customers in 170 days of its launch. "This subscriber retention is well above the recent expectations of 50 million that were being built in. This will lend confidence in the ability of Reliance Jio to monetize services and challenge incumbents," Jefferies stated. Analysts believe Reliance Industries will be able to breakeven in its telecom operations much earlier than expected.
Reliance Industries share closed 1.48 per cent lower at Rs 1,370.45 giving it a total market value of Rs 4.46 lakh crore on Tuesday, below that of TCS at Rs 4.55 lakh crore (at closing price of Rs 2,308.65, down 0.53 per cent ).