Reliance Industries Ltd (RIL) shares surged over 11 per cent on Wednesday taking its overall market value to Rs 3.92 lakh crore, up from Rs 3.53 lakh crore yesterday after it announced that its telecom unit Jio will start charging its customers from April. With today's gains it surpassed HDFC Bank in terms of market capitalisation to become the second most valuable company in India after TCS.
Reliance Jio on Tuesday announced a new Prime membership offer under which its existing customer can continue to get the unlimited benefits for one more year at an one-time membership fee of Rs 99 and a monthly fee of Rs 303.
Jio's Prime membership announcement alleviated investor's concerns on its profitability as RIL has invested over $20 billion in it. With Jio starting to monetise its customer base, analysts believe it will be able to breakeven much faster than it was expected earlier.
"The data offering of Jio's Prime plan is substantially higher than existing plans of other operators. Jio is expected to retain most of the 10 crore subscribers who have come to its network," said Mayuresh Joshi, fund manager at Angel Broking.
Under the Prime membership, customers will continue to get free voice incoming and outgoing calls, free roaming and data usage of 1 GB per day. Further, subscribers will continue to use the services of MyJio app for free.
Analysts welcomed Jio's shift to paid services under the Prime offering, saying it would bring more rational competition to the sector.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
