Tata Consultancy Services on Friday became the most valuable company in the country in terms of market capitalisation (m-cap). The Tata group company piped Mukesh Ambani-led Reliance Industries (RIL), which has been battling with lower gas output from the KG-D6 oil and gas block for the past two quarters. Analysts said the growth in the information technology (IT) sector over the past couple of years has helped TCS grow faster and it is expected to remain on top in the long run.

“TCS will be able to hold on to the top position in the long term on the back of a spur in growth in the IT industry,” said Sarabjit Kour Nangra, vice-president of research at Angel Broking. However, she also said the RIL stock is undervalued in terms of valuation.

“If our base case of muddle through global growth in the US and Europe is maintained, TCS will be able to maintain its leadership position of being the most valuable company in India, unlike most others who are dependent on growth in the domestic market,” Das said.

The market-cap of TCS on the Bombay Stock Exchange was Rs 2,27,282.29 crore at Friday’s close, compared with Rs 2,26,886.79 crore of RIL. ONGC, which has always remained a key competitor was on the third slot with a market cap of Rs 2,19,833.32 crore, while Coal India came in fourth with Rs 1,90,659 crore.

Jagannadham Thunu-guntla, strategist and head of research at SMC Global Securities, said: “The Tata group was once accused of sluggishness and lack of aggression during 1990s. Further, TCS was earlier not even seen as the leader of the IT industry. It was always seen as one catching up with Infosys. However, a lot has changed for the Tata group and TCS over the past two decades. Since Ratan Tata took over, he has definitely changed the level of aggression and energy levels of the group.” Shares of both TCS and RIL fell 0.35 per cent and 2.81 per cent, respectively, to close at Rs 1,161.25 and Rs 692.9, respectively on BSE on Friday.

In July, Tata group’s market-cap moved above not only that of RIL, but also above the combined market wealth of Mukesh Ambani-led RIL and his younger brother Anil Ambani-led Reliance Adag Group.

Analysts said except for the joint venture with British Petroleum, there were not many good news for RIL. Further apart from lower output from the KG-D6 oil and gas block, all other businesses including retail faced longer gestation period.

RIL’s leadership position was also challenged by Coal India for a brief period of five days during August 17-22 and later by another PSU, ONGC.

Earlier this month, RIL lost its position as the country’s most influential stock to another IT company – Infosys, as measured by their weightage on Sensex. The Bangalore-based Infosys now has a weightage of 10.65 per cent on Sensex, while RIL has 9.85 per cent. Even the free float market-cap of Infosys is above that of RIL at Rs 1,34,954.52 crore.