Reliance Industries Ltd. regained its position as Indiaâ€™s second most-valuable company after its shares posted their biggest advance in eight years.
The stock surged 11 percent at the close, valuing the company at 3.92 trillion rupees ($59 billion), as investors cheered Chairman Mukesh Ambaniâ€™s decision to end free data plans at his phone venture from April. HDFC Bank Ltd. on Friday had overtaken Reliance after a 3.7 percent advance in its shares.
â€œInvestor concerns that Reliance may extend the free mobile-phone services have faded,â€ Rajendra Prasad, an analyst at Karvy Stock Broking Ltd., said by phone.
â€œAnalysts are making back-of-the-hand calculationsâ€ on when Relia-
nce Jio Infocomm will turn profitable, he said.
Prasad said he will revise his price target of 1,192 rupees. Other analysts may also need to change their price forecasts after the stock rose above the one-year consensus price target for the first time since June 2014. Relianceâ€™s weighting in the S&P BSE Sensex rose a notch to 7.56 percent, surpassing software exporter Infosys Ltd. as the fourth-biggest company on the gauge by index weight, according to data compiled by Bloomberg.
Tata Consultancy Services Ltd. is Indiaâ€™s most-valuable company. Reliance, which has spent $25 billion on its fourth generation, wireless data network, started to offer services free for an introductory period from September last year. The extension of the offer to March 31 had raised concerns among investors including HDFC Securities Ltd. and Sanford C. Bernstein about the viability of the business. Reliance Jio Infocomm Ltd. has signed up 100 million customers so far.
Those concerns eased after Ambani said Tuesday customers will have the option of signing up for a Jio Prime membership at 99 rupees ($1.48) for one year, plus a monthly charge of 303 rupees, to continue using unlimited services for a year.
The monthly charges are attractive enough to allow retention of at least 50 percent of its customer base, Tarun Lakhotia, an analyst at Kotak Institutional Equities said in a report to clients Wednesday.