Disconnected reality: How RCom, Jio landed up at opposite ends of the spectrum

October 2026 will go down in the annals of Indian corporate history as a milestone of both value creation and value destruction, by two brothers who parted ways in 2005, when the then-undivided Reliance Industries was split into two groups.

On October 5, the Department of Telecommunications (DoT) took back the spectrum it had allotted to the now bankrupt Reliance Communications (RCom) which is undergoing corporate insolvency amid investigations by the Enforcement Directorate (ED) over financial fraud. In the same month, 23 days later, on October 28, Mukesh Ambani’s Jio Platforms made a stunning public market debut, valuing the telecom behemoth at over Rs 13 lakh crore.

The irony is that what was once an Anil Ambani-owned telecom company is now worth Rs 230 crore, a value decimation of 99.99% from its 2008 peak of Rs 1.5 lakh crore at Rs 844 a share to now 83 paise a share.

A dream call

It was on December 28, 2002, on what would have been founding patriarch Dhirubhai Ambani’s 70^th birthday, Reliance Infocomm switched on its mobile network with a catchy slogan: Kar lo duniya mutthi mein (Hold the world in your fist). Dhirubhai passed away in July 2002, but it was his idea of creating a telecom business that would cost less than a post card. Infocomm made its debut with CDMA handsets sold for Rs 501, enabling millions of Indian to make that first mobile call on a Reliance phone.

While the telecom venture was Mukesh Ambani’s pet dream inside the undivided RIL, within two years it would become the biggest prized asset in a family split.

While Infocomm caught the nation by a storm, by late 2004, the brother’s differences spilled into public view with the country’s most powerful business family caught in an ugly slugfest that was fought through proxies, board resolutions and media leaks. Finally, in June 2005, mother Kokilaben Ambani, helped by family friend and well-respected banker, KV Kamath, put in place an agreement that divided the empire among the two brothers.

Elder brother Mukesh got refining, petrochemicals, oil and gas businesses, younger brother Anil got all the promising businesses comprising telecommunications, infrastructure, financial services, under what was then known as the Anil Dhirubhai Ambani Group (ADAG). A non-compete was put in place that barred each brother out of the other’s businesses, including telecom.

The demerged telecom business under Anil was listed in March 2006 as Reliance Communications. In the euphoric bull run of 2007 and early 2008, RCom raced away to a peak of Rs 844 a share, at nearly Rs 1.5 lakh crore. It was around the same RCom was in talks with South Africa’s MTN in a deal that would have created a telecom giant.

But the tide turned post the global financial crisis in 2008.

By end of March 2011, RCom was still a going concern with 142 million customers, and served over 35,000 Indian and multinational corporations, counting it among the world’s top four telecom companies, as per the company’s then annual report. The company had scale with a network that reached over 24.000 towns and 6 lakh villages, carrying voice, data and video over wireless and wirelines run over 2.77 lakh km of fibre-optic cable across India, the US, Europe, the Middle East and Asia-Pacific.

Anil’s letter to shareholders in the annual report was glowing, as he credited RCom of pioneering telecom inclusion in India with turning mobile phone from a luxury to a necessity in under a decade. The confidence came on the back of the company having won 3G spectrum in 13 circles, more than any other operator, in the 2010 auction. The company had launched 3G services in Delhi, Mumbai, and Kolkata within 100 days of getting the airwaves, and went on to roll out 3G in all the 13 circles covering 330 towns.

But the story started to weaken as the years progressed.

The slow bleed

RCom was saddled with a technology that the world was casting away, and it had to play catch-up with Airtel and Vodafone with borrowed money. As on March 2011, RCom has assets of Rs 94,722.68 crore, shareholders' equity of Rs 40,499.18 crore and net debt of Rs 32,066.51 crore. The net debt to equity ratio at 0.79 times was still manageable but the debt kept piling up to Rs 45,000 crore, even as revenues and margins collapsed.

The subsequent cancellation of 2012 licences, rising spectrum fees amid falling tariffs hurt RCom the most. Attempts to sell the towers business, merge with Aircel and other monetization attempts failed.

Even as Anil was struggling with RCom, the brothers scrapped their 2006 non-compete agreement with the only exclusion for Mukesh that he would not enter the gas-based power generation, until 2022. In doing so, the new agreement opened the door for the brothers to enter each other’s businesses, including telecom and financial services.

A month later, in June 2010, RIL entered telecom by investing Rs 4,800 crore for 95% stake in Infotel Broadband Services, which had won the only pan India broadband wireless access (BWA) spectrum in that year’s auction. Within hours of RIL’s entry, a spokesperson for the ADAG group said: “We welcome the entry of Reliance Industries into the high potential wireless broadband space.”

But the entry in a way was beginning of a painful transition for all other telecom players, including RCom, as in the ensuing six years, RIL invested over Rs 1.5 lakh crore in building an all 4G network from scratch as Infotel’s broadband network was a 4G mobile network from the start. In 2013, the government allowed BWA spectrum holders to offer voice calls through a unified licence. With a migration fee of Rs 1658 crore, RIL renamed Infotel as Relaince Jio Infocomm in January 2013.

On September 5, 2016, Jio unleashed its heft on the industry by offering free voice calls, free national roaming and months of free data, making the most disruptive phase in Indias telecom history. Ironically, that same year RCom signed a spectrum sharing and trading deal with Jio renting its own 800 MHz band. By March 2017, RCom’s debt piled up Rs 45,733 crore, amid payment defaults.

Anil told RCom shareholders that falling rates had led to ‘creative destruction’ even as lenders had already turned wary.

Collapsing tariffs forced weak hands out with Telenor India and Tata Teleservices' consumer mobile business subsumed into Bharti Airtel and Aircel filed for insolvency in 2018. Even as Airtel withstood the onslaught, Vodafone and Idea Cellular merged in 2018, and eventually the government became the largest shareholder after converting its dues into equity.

RCom was sinking.

It shut down its 2G wireless service in late 2017 and planned asset sales of its wireless assets to Jio failed over dispute related to government dues.

The lowest personal moment came for Anil, when his brother bailed him out from a jail term after the SC held Anil in contempt of not paying Swedish equipment maker, Ericsson, dues worth Rs 550 crore.

Eventually RCom went into insolvency and in June 2019, its affairs were taken over by resolution professional with the control effectively moving to a committee of creditors. In 2019, Jio bid Rs 3720 crore for the tower and fibre assets of Reliance Infratel, a subsidiary of RCom and by end of 2022 took full ownership of Reliance Infratel.

The lenders had, meanwhile, blown the whistle on RCom, alleging misconduct. A forensic audit by BDO India reported irregularities in the company’s accounts from 2013 to 2017, with banks classifying RCom loan accounts as fraud even as the Bombay High Court upheld SBI’s order. The ED too got into the picture over alleged diversion and laundering of bank loans across Anil Ambani owned entities and the agency has till date made a series of provisional attachments of Rs 19,344 crore against the group's outstanding loans of Rs 40,185 crore.

The cold call

Till recently, RCom’s resolution plan depended on selling the spectrum as an asset, which the SC finally ruled in February 2026 that spectrum is a natural resource held by the government in public interest and that telecom companies hold only a conditional, revocable right to use it. In other words, it could not be sold or restructured under the IBC. A review petition filed by RCom and its subsidiary Reliance Telecom, too, was dismissed in July 2026.

The DoT in July issued a show cause notice to RCom group over unpaid spectrum instalments, damages and missed rollout obligations and, on October 5, the day RCom’s creditors held a meeting, the DoT terminated every block of spectrum that RCom and RTL held across the 13 circles.

As of September 2026, the company’s total financial indebtedness stood at Rs 41,309 crore, including Rs 27,673 crore of bank and institutional loans, with unprovided interest on top.

What remains is an enterprise wireline and wholesale voice business that earned Rs 391 crore in FYY25 and lost Rs 186 crore on its operations. Of the Rs 26,256 crore assets shown on the book are wireless spectrum towers, licences, fibre and network nodes but carried at their March 2018 values.

The auditors have qualified that RCom hasn’t booked Rs 4,692 crore of interest on its loans for FY25, and Rs 28,786 crore for the earlier years. The company has not yet filed FY26 annual report.

With a market cap of Rs 230 crore, RCom is a ghost of a business versus the Rs 13 lakh crore for Jio Platforms, which debuted at over 21% premium at Rs 1,358 against an IPO price of Rs 1,119 and closed near ₹1,419, valuing it at about Rs 13.1 lakh crore.

In effect, this October brought down the curtain on the Ambani brothers’ saga, with the elder brother holding the world firmly in his fist.