RIL stocks to surge further on Reliance Jio's strong user retention

Mumbai: Stocks of Mukesh Ambani-led Reliance Industries have gained more than 26 per cent on the BSE over the past three months as Reliance Jio has shown a strong customer retention trend.

The rally in RIL stocks is likely to further strengthen as Reliance Jio has registered more than expected number of existing users. Jio currently has over a 100 million users under its Happy New Year plan.

Experts said that there was an expectation of 35-40 per cent retention of existing Jio users after announcement of paid services. On the contrary, over 72 million existing users have opted for Jio's paid services for annual fee of Rs 99. This means 72 per cent users have thrown their weight behind Jio and its services.

With a strong retention rate, Reliance Jio is on its way to reducing its operating loss in future, according to a report in The Economic Times.

"The higher retention rate is likely to lower expected loss from Jio in the current and next fiscal, which may in turn improve RIL's earnings. Currently, analysts expect a loss of Rs 25-30 per share for FY18 and Rs 11-15 per share for FY19 from Jio," ET report said.