Oct. 24 (Bloomberg) -- Research In Motion Ltd., maker of the Blackberry e-mail phones, overtook Royal Bank of Canada as the country's biggest company by market value as it won millions of new subscribers for its wireless e-mail service this year.

Research In Motion traded as high as C$123.24, up 2.3 percent, giving it a value of C$69 billion ($71.2 billion) at 9:58 a.m. before the shares fell, reducing market capitalization to C$67.4 billion, trailing Canada's biggest lender.

Research In Motion became the first technology enterprise to take the top spot since Nortel Networks Corp. in 2000, before the maker of phone and network equipment crashed in the telecommunications and internet bust in 2000. Research In Motion shares, which fell 11 cents to C$120.31 as of 4:10 p.m. in Toronto, have still more than doubled this year, the second-best performance in Canada's main stock benchmark, the Standard & Poor's/TSX Composite Index.

``The stock is on a roll, and rightly so,'' said Pat McHugh, who helps manage the equivalent of about $310 billion, including Research In Motion shares, at MFC Global Investment Management in Toronto. ``RIM will be No. 1 in due course. It makes a product most people can understand. Nortel in its heyday made things you needed a Ph.D to understand.''

EnCana Corp., Canada's biggest natural-gas producer, briefly was the most highly valued Canadian company in September 2005 after natural-gas price peaked following Hurricane Katrina.

Subprime Fallout

Royal Bank, Canada's biggest lender by assets, declined 84 cents, or 1.6 percent, to C$52.90. It has fallen 4.7 percent this year to a market value of C$67.5 billion amid concern that banks will be hurt by the fallout from rising mortgage delinquencies in the U.S.

Research In Motion had its target raised to $150 from $125 today by UBS AG analysts including Jeffrey Fan, after it announced a plan to start selling its e-mail phones to business customers in China through France's Alcatel-Lucent yesterday. UBS kept its ``buy'' rating on Research In Motion.

By contrast, analysts at TD Newcrest led by Chris Umiastowski cut the company to ``hold'' from ``buy'' today, citing the ``strong stock price appreciation.'' TD Newcrest still raised its share-price forecast to C$126.30 from C$111.72.

Research In Motion shares are trading at 82 times reported earnings, above its historic average of 58 times. The Waterloo, Ontario-based company had doubled its number of subscribers to 10.5 million in August from 2006, and may have 26 million by the end of 2009, according to TD Newcrest's note.

`Not Sustainable'

``It's a great company and we own lots of it,'' said Gavin Graham, who helps oversee the equivalent of about $5.3 billion as chief investment officer at Guardian Group of Funds in Toronto. ``But we've been trimming it all along on the way up, because the valuation is not sustainable.''

Shares of Toronto-based Nortel Networks have fallen 97 percent from their peak in July of 2000 after demand for its products waned and the company disclosed irregularities in its accounting.

At their peak, Nortel shares accounted for more than a third of the S&P/TSX's value. Research In Motion makes up about 3.7 percent of the benchmark's C$1.69 trillion capitalization.

Manulife Financial Corp., Canada's biggest insurer, is the third-largest company in the S&P/TSX with a market value of C$62.3 billion. It is trailed by Bank of Nova Scotia, worth C$49.6 billion, and Toronto-Dominion Bank, which has a market capitalization of C$49 billion.

Sino-Forest Corp., an owner of timberland in China, is the S&P/TSX's best performer this year with a gain of 192 percent.

To contact the reporter on this story: John Kipphoff in Toronto at jkipphoff@bloomberg.net.

Last Updated: October 24, 2007 16:49 EDT