Mumbai: The Securities and Exchange Board of India (SEBI) has given its nod to Jio Platforms Ltd, a digital and telecom firm of the Reliance Industries, to proceed with its highly anticipated Initial Public Offering (IPO). The proposed offering (c. ₹37,700 crore ($3.8–4 billion) assumed at the expected size) will be the largest IPO in India.
In the week that ended August 28, SEBI gave its observation letter on the company’s Draft Red Herring Prospectus (DRHP), which is a vital regulatory hurdle for Jio Platforms. The company had announced its draft IPO papers with SEBI on June 19, and Mukesh Ambani, chairman and managing director of the Reliance Industries, had declared the IPO.
Hyundai Motor India’s record may get broken at IPO.
With the estimated raise of around ₹37,700 crore, the issue will easily break the current record of the Hyundai Motor India, which raised about ₹27,859 crore in its IPO in 2024. At the time, the largest public offering in India was by Hyundai.
The Jio IPO will therefore be a pivotal event for India’s capital markets, and will provide investors direct access to one of India’s largest digital and telecom companies.
As per the DRHP, Jio Platforms is looking to offer as many as 27 crore fresh equity shares. The problem is that it is a dilution of about 2.9% of the company’s equity. While in an offer for sale, the existing shareholders sell the shares, in the Jio offering, it is structured as a new issue, where the funds received would go to Jio.
The majority of funds to be used for debt repayment.
A significant portion of the proceeds from the IPO will go towards reducing the debt of the telecom operating company, Reliance Jio Infocomm.
Of this, ₹27,500 crore or approximately $3.3 billion is proposed to be utilized in repaying borrowings, and the balance is for general corporate use. Adopting the debt repayment plan may boost Jio’s balance sheet and offer it more financial freedom for future investments.
The valuation of Jio Platforms could exceed $100 billion, though the valuation will vary depending on the issue price and the market conditions at the time of the IPO. The final price range has yet to be announced.
Jio’s Expanding Digital Business
Jio Platforms is a much more than a telecom organization. The company has diversified its operations beyond telecom to digital services, cloud computing, enterprise solutions and artificial intelligence through its various businesses.
At the end of March, the number of Reliance Jio subscribers stood at over 524 million, putting it among the world’s biggest mobile operators. According to more recent numbers reported by Reuters, Jio Platforms has over 533 million users.
Global technology companies are also big investors in the company. Reliance Industries now has approximately 66.4% stake in Jio Platforms, with strategic investors such as Meta and Google.
