Mumbai (India) (AFP) – Shares in India’s Jio Platforms surged nearly 27 percent on its market debut Wednesday, after raising more than $3 billion in the country’s biggest initial public offering. The company, home to India’s biggest wireless operator and which is the digital services arm of billionaire Mukesh Ambani’s Reliance Industries, ended the first day of trading at 1,417.5 rupees on the National Stock Exchange — well up from its 1,119-rupee issue price.
Wednesday’s rally gave Jio a valuation of about $137 billion, turning it into India’s second-most valuable listed firm after its parent. Launched a decade ago, Jio’s wireless service disrupted the market with steep discounts that helped it rapidly win customers from rival telecom firms Bharti Airtel and Vodafone. With more than 530 million subscribers, the firm currently makes most of its money from telecoms but has expanded in recent years into newer areas including digital services and artificial intelligence.
The listing, one of the most anticipated this year, attracted robust demand last week with the IPO being 22 times oversubscribed. “In our first 10 years, we democratised data… In our next 10, we want to democratise every technology that can transform Indian lives,” Akash Ambani, managing director of Jio Platforms and Mukesh’s eldest son, said at the listing ceremony in financial capital Mumbai. “AI, cloud, connected devices, connectivity even from space and digital services not yet imagined.”
The ceremony, which was attended by several members of the Ambani family, saw the billionaire patriarch fight back tears during the speeches delivered by his children. Analysts at Nomura, who initiated coverage on the stock on Wednesday, said the company’s focus for Jio had shifted “from adding users to earning more from each customer.” “We believe the heavy 5G investment cycle is largely behind for Jio… freeing up significant cash flow,” they said.
Experts say Jio is key to Reliance’s strategy to evolve beyond its traditional oil business and the touchstone of its future tech ambitions. Local media have reported that it is considering a low-orbit satellite constellation to provide internet services from space — a venture that would see it compete with Elon Musk’s Starlink, which has been trying for years to launch in India. The world’s richest man accused unnamed Indian “oligarchs” this month of preventing Starlink’s rollout in the country and referred to the Reliance chairman as “Prime Minister Ambani” and the “real boss of India.”
Reliance responded by noting that it had never “feared competition” and welcomed offerings from rivals in satellite communications, including Starlink. While Jio has expanded beyond its telecom roots, experts have cautioned investors that it will take time for its efforts to bear fruit. Monetisation of newer digital services are “still to be demonstrated at scale,” analysts at financial services firm Motilal Oswal noted earlier this month.
© 2024 AFP
