Reliance Jio’s next decade of disruption

WHEN JIO ENTERED India’s telecom space in September 2016, it changed the rules of the game. Free voice calls, rock-bottom data tariffs and an aggressive network rollout triggered a price war, forced incumbents to rethink their business models and brought millions of Indians into the digital economy. A decade later, the disruptor has rewritten the rules of another segment: the capital markets. Jio Platforms’ October 28 stock market debut was more than the launch of India’s largest-ever IPO. At ₹30,213 crore, the issue attracted a record 1.34 crore (13.4 million) applications, becoming the first Indian public issue to cross the one-crore mark. It received bids worth ₹7.4 lakh crore, including nearly ₹2.5 lakh crore from anchor investors, and was subscribed 22.19x. The qualified institutional buyers’ portion was subscribed 70.55x. The investor appetite translated into a strong debut. Jio shares listed at ₹1,358 on the bourses, a premium of 21.36% over the issue price of ₹1,119. The stock closed at ₹1,419, up 26.81%, adding around ₹2.75 lakh crore to the company’s market capitalisation in a single session. With a market capitalisation of ₹13.05 lakh crore at the close, Jio became India’s second-most valuable listed company, behind parent Reliance Industries (RIL) at ₹15.67 lakh crore. It also overtook Bharti Airtel, valued at ₹12.16 lakh crore, to become India’s most valuable telecom firm. Jio recorded the highest listing gain among the five largest IPOs in recent times, ahead of NSE India, which gained 1.85% on debut. Its performance contrasted with the listing-day losses recorded by Hyundai Motor India, LIC of India, and Paytm. The debut also placed Jio among the world’s most valuable listed telecom companies. Ranked sixth by market capitalisation ($131 billion), it became Asia’s second-most valuable listed telecom firm after China Mobile. As of October 28, China Mobile had a market capitalisation of about $221 billion, followed by Verizon at $182 billion, T-Mobile US ($157 billion), AT&T ($141 billion) and Germany’s Deutsche Telekom ($135 billion), according to Bloomberg data. The IPO, comprising fresh shares, was fully subscribed within 100 minutes of opening, while the QIB portion was covered in the first 10 minutes. At the issue price, Jio Platforms was valued at around ₹10.3 lakh crore, or $108 billion. RIL Chairman & MD Mukesh Ambani called the listing a historic moment in the group’s value-creation journey, saying it had revived the equity culture pioneered by the group’s founder. “I am proud to witness the rejuvenation of ‘the equity cult’ originally pioneered by our founder-chairman during the 1977 Reliance IPO.” A legacy RIL’s relationship with public-market investors goes back to 1977, when Dhirubhai Ambani took Reliance Textile Industries public. The company raised ₹2.82 crore through an issue of 2.82 million shares at ₹10 apiece. The issue was subscribed 7.19x, and the shares made their debut on the Bombay Stock Exchange in January 1978. Dhirubhai believed ordinary Indians should have a stake in the growth of businesses they helped build. Jio’s listing brought that philosophy back into focus. It was the first Reliance Group IPO since Reliance Petroleum in 2006, ending a 20-year gap in the group’s primary-market offerings. Jio Platforms is the 12th company from the Reliance Group to list on the bourses. At the listing ceremony, Isha Ambani drew a direct link between the two milestones. “My grandfather believed that anyone in this country, however humble their beginnings, deserved a share in India’s growth… Not as spectators, [but] as owners,” she said, crediting her father with building Jio around the principle of putting customer value first. The listing strengthened Reliance’s position as India’s most valuable conglomerate by aggregate listed market capitalisation. At the close of Jio’s debut session, RIL and Jio together commanded a market value of more than ₹28 lakh crore, overtaking the Tata Group in combined listed market capitalisation. Next-gen steps up The listing was also a moment for the Ambani family’s next generation, with Akash, Isha, and Anant being at the centre of it. Their roles in the group have taken shape over the past few years. Akash became chairman of Reliance Jio Infocomm in 2022 and is now MD of Jio Platforms. He has also been associated with Reliance’s retail businesses since 2014. Isha is closely involved with the group’s consumer and retail operations, while Anant is associated with its new-energy projects. At RIL’s AGM in June, Mukesh Ambani said the transfer of day-to-day management responsibilities to the next generation was “almost complete”, while making it clear that he would continue to provide hands-on leadership. The transition was visible in the run-up to Jio’s IPO. On October 15, during the price-band announcement, Akash led a meeting with bankers, investors, analysts, and the media. Isha joined him on stage, while Anant was among the audience. At the listing ceremony, the siblings spoke about the company’s journey and the responsibility of taking it forward. “Our responsibility is not merely to preserve what we inherited, but to make Jio bigger, better, and more meaningful for India,” Akash said. Anant invoked the blessings of his family and thanked Prime Minister Narendra Modi for the Digital India initiative, describing it as the vision that had given Jio its purpose. Jio’s first decade, Akash said, had been about bringing hundreds of millions of Indians into digital life. The next 10 years would be about making a wider range of technologies accessible, including AI, cloud, connected devices, satellite connectivity, and digital services. Jio’s ambitions now stretch across AI, cloud computing, connected devices, connectivity from space and digital services. It wants to build on the network and customer base it has created to offer a wider range of products and services. Akash described the vision as a digital society in which connectivity, computing, and intelligence work together. Jio wanted to take its tech capabilities beyond India, positioning its platforms as products built in India, for the world. “We are now ready to take the tricolour global,” he said. For now, however, telecom remains the foundation of the business. The challenge will be to build newer revenue streams around that foundation and demonstrate that investments in emerging technologies can translate into meaningful earnings. Valuation & more The enthusiasm around Jio’s IPO was reflected in the institutional demand and strong listing gains. But the bigger question for shareholders is what comes next: can it sustain growth, expand beyond connectivity, and deliver returns that justify its valuation? Brokerages Nomura and Motilal Oswal Financial Services Ltd (MOFSL) initiated coverage on Jio Platforms on the day of its listing, both with ‘Buy’ ratings. Nomura said Jio Platforms has evolved from a telecom disruptor into a market leader, with 42% of India’s wireless subscribers, 60% of data traffic and 43% of the home broadband market. Its listing could strengthen its position as a price setter, paving the way for gradual tariff hikes that peers may follow. It expects Ebitda to grow at 13.5% CAGR between FY26 and FY29, driven by its strong network and leading subscriber base. MOFSL expects Jio to maintain its leadership in wireless and home broadband while scaling its digital platforms across cloud, enterprise communications, IoT and managed services. It projects CAGR of 14% in consolidated revenue, 15% in reported Ebitda and 20% in PAT in FY26-29. Religare Broking sees the IPO as a potential trigger for a re-rating of RIL. A clearer valuation of Jio, it argues, could improve transparency in the group’s sum-of-the-parts valuation and narrow the holding-company discount. The valuation, though, leaves investors with plenty to assess. At the IPO price, Jio was valued at around 34x FY26 earnings and 13.5x Ebitda. Sustaining a premium valuation will require continued growth and the ability to turn its tech ambitions into earnings. Jio Platforms reported FY26 net profit of ₹30,049 crore and Ebitda of ₹76,255 crore. In Q2FY27, net profit rose 13.7% year-on-year to ₹8,387 crore. Revenue increased 11.4% to ₹40,475 crore, while Ebitda grew 16.6% to ₹21,879 crore. ARPU stood at ₹218.8 during the quarter. Jio crossed 300 million 5G mobility subscribers and 30 million fixed broadband subscribers, while its overall subscriber base exceeded 542 million. It added 9.1 million subscribers during the quarter, with monthly churn at 1.6%. Brokerages see several growth levers beyond the core telecom business. SBI Securities points to tariff rationalisation, migration from 2G to 4G and 5G, higher data consumption, home broadband expansion, and greater enterprise adoption of cloud and digital solutions. AI-led services, and digital applications could offer additional monetisation opportunities. The IPO also offers a balance-sheet benefit. Up to ₹27,500 crore of the proceeds will be used to prepay or repay borrowings of Reliance Jio Infocomm. SBI Securities expects the debt reduction to lower finance costs, strengthen cash flows, and provide greater financial flexibility. Religare Broking sees lower debt and interest expenses improving Jio’s free cash flow generation and supporting cash accruals at RIL. For Jio, the listing is a starting point. The real test will be whether it can make the next decade as consequential as the first — and convert its scale, tech ambitions, and investor confidence into sustained shareholder value.

Reliance Jio’s next decade of disruption

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