Jio IPO: ₹27,500 crore earmarked for debt repayment, financial flexibility
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After years of anticipation, Mukesh Ambani-led Jio Platforms has finally filed papers for its blockbuster initial public offering (IPO), setting the stage for what is expected to be the largest public issue in India's capital market history.
The IPO of the Reliance Industries subsidiary comprises entirely a fresh issue of up to 27 crore equity shares with a face value of ₹10 each, ensuring that all the capital raised flows directly into the company. While Jio is yet to disclose the exact issue size, market estimates suggest the offering could raise between ₹36,000 crore and ₹40,000 crore.
According to the draft red herring prospectus (DRHP) filed with the Securities and Exchange Board of India (Sebi), the company plans to utilise up to ₹27,500 crore from the net proceeds towards the repayment and prepayment of borrowings at its key operating subsidiary, Reliance Jio Infocomm Ltd. (RJIL).
The allocation highlights Jio's focus on further strengthening its balance sheet despite already reporting strong financial performance and industry-leading profitability. Unlike many recent mega IPOs, the offering does not include an offer-for-sale (OFS) component. Existing shareholders—including Reliance Industries, Meta, Google, KKR, Silver Lake and several sovereign wealth funds—will not be selling shares as part of the issue.
Debt repayment to boost financial flexibility
The debt repayment plan forms the centrepiece of Jio's IPO objectives. "The company believes that such prepayment will help reduce the Net Debt and the associated servicing costs, and improve our Net Leverage and the NAV of the Equity Shares, thereby improving the results of our operations and financial condition," Jio said in the DRHP.
RJIL, which operates India's largest telecom network and serves as the backbone of Jio's digital ecosystem, has, over the years, raised funds through a range of borrowing arrangements, including term loans and external commercial borrowings (ECBs) from domestic and international lenders.
The loans proposed to be prepaid include borrowings from a consortium of global banks such as Australia and New Zealand Banking Group, Bank of America, Barclays, BNP Paribas, Citibank, DBS Bank, HSBC, Mizuho Bank, MUFG Bank and Standard Chartered, among others.
The company said the final selection of borrowings for repayment will depend on factors such as the maturity profile, borrowing costs, interest rates, exchange-rate considerations, regulatory requirements and commercial terms associated with prepayment. It has also retained the flexibility to utilise IPO proceeds for the repayment of refinanced borrowings if any existing loans are replaced before the offering is completed.
Leaner balance sheet to support 5G, AI and digital expansion
The deleveraging strategy comes even as Jio has already made significant progress in reducing leverage. Its net leverage ratio improved from 0.88x in FY24 to 0.71x in FY25 and further to 0.36x in FY26, reflecting a steadily strengthening balance sheet ahead of the public listing.
However, the company views debt reduction as more than just a balance-sheet exercise.
"The Company believes that this would improve our ability to raise further resources in the future to fund potential business development opportunities," the DRHP stated.
Jio added that the "progressive deleveraging of the balance sheet" would position the company favourably for continued investments in strategic growth areas, including 5G network densification and expansion, fixed broadband penetration, AI and cloud services, enterprise digital solutions and international technology partnerships.
That focus on future investments reflects the scale Jio has achieved since disrupting India's telecom sector nearly a decade ago. The company ended FY26 with a subscriber base of 524.4 million customers, up from 488.2 million a year earlier, cementing its position as the country's largest telecom operator.
On the financial front, revenue from operations rose to ₹1.47 lakh crore in FY26 from ₹1.28 lakh crore in FY25 and ₹1.10 lakh crore in FY24. Profit after tax increased to ₹30,049 crore in FY26 from ₹26,109 crore in FY25 and ₹21,423 crore in FY24.
The company generated EBITDA of ₹76,255 crore in FY26, translating into an EBITDA margin of 51.9%, placing it among the most profitable telecom and digital infrastructure businesses globally.
Apart from debt repayment, Jio intends to allocate a portion of the IPO proceeds towards general corporate purposes. The DRHP specifies that utilisation under this category will not exceed 25% of the gross proceeds from the issue.
The company said these funds could be used for strategic initiatives, capital expenditure, working capital requirements, organic and inorganic growth opportunities, marketing and brand-building activities, deferred payment obligations, and other corporate purposes approved by the board.
The IPO will also mark a significant milestone for Reliance Industries, which held a 66.43% stake in Jio Platforms as of March 31, 2026. Given the absence of an OFS component, Reliance's control over the company is not expected to undergo any material change following the listing.