Jio Platforms IPO fully subscribed in under two hours

Jio Platforms’ Rs 30,213 crore initial public offering (IPO) was fully subscribed in less than two hours of bidding on Wednesday, as institutional investors placed strong demand for what is set to become India’s largest public issue.

The portion reserved for Qualified Institutional Buyers (QIBs) was subscribed 2.86 times by 10 am, according to sources. Exchange data later showed institutional investors had bid for 3.25 times their reserved allocation.

An earlier update put overall subscription at 0.83 times. Retail investor demand stood at 0.22 times the portion reserved for them in the exchange data, with around a third of the shares on offer set aside for retail investors.

The IPO opened on Wednesday and will close on October 23. The offering is seeking to raise about Rs 30,213 crore through a fresh issue of up to 27 crore shares, with no offer-for-sale component. This means existing shareholders are not selling their shares through the issue.

Jio Platforms’ public offering is set to surpass Hyundai Motor India’s Rs 27,870 crore IPO in 2024, making it India’s largest IPO by value.

The price band is set at Rs 1,065 to Rs 1,119 per share. At the upper end, Jio Platforms is valued at roughly $108 billion, or up to $108.3 billion. Trading is expected to begin on October 28.

Jio Platforms IPO draws $25 billion in anchor investor bids: Report

The offering is the first IPO from Reliance Industries since 2006. Mukesh Ambani had first promised a listing within five years in 2019, but the plans were delayed, including in 2025. A planned filing as early as March was pushed back after the Iran war dampened IPO appetite.

Anchor investors commit Rs 8,110 crore

On Monday, Jio Platforms allotted shares worth about Rs 8,110 crore to 212 anchor investors at Rs 1,119 apiece, the top end of the price band, ahead of the public offering.

Bids for the anchor allocation exceeded Rs 2.5 lakh crore, representing more than 30 times the amount available, according to people familiar with the matter. One person put total demand at about $26 billion.

The company also allotted shares worth $853 million to global and domestic investors, including the Abu Dhabi Investment Authority and BlackRock, after the allocation reserved for these investors received bids totalling more than $25 billion.

Jio Platforms has backing from Meta, Alphabet’s Google and institutional investors. Its business includes India’s largest telecoms company, with 533.3 million customers, making it the world’s second-largest telecoms operator in a single country after China Mobile.

Akash Ambani pitches technology and AI growth

Ahead of the IPO, managing director Akash Ambani said on Tuesday that Jio Platforms was looking beyond telecoms to technology, artificial intelligence (AI) and cloud services as drivers of future growth.

“There is no either-or at Jio: the network is our technology,” Ambani said in an interview with PTI, highlighting the company’s in-house 5G core, cloud-native radio access network and software platform serving 533.3 million customers.

“Connectivity was the first product we built on that platform.

“Digital services, AI and cloud are what we are layering on top of it now,” he said.

The IPO comes as investors assess whether India’s largest telecoms operator can turn its large customer base into higher-margin revenue from digital services, enterprise technology and AI, as subscriber growth alone becomes a less powerful driver of expansion.

Jio Platforms’ telecoms business began in 2016 under Akash Ambani, with a strategy based on the premise that more Indians would use the internet if access became significantly cheaper. It rapidly gained market share from rivals such as Bharti Airtel and Vodafone Idea by offering low-cost data and free voice calls.

The company is pitching its IPO during the Hindu festive season, which is considered auspicious for purchases, even as Indian markets have remained subdued in recent weeks. Reliance paid its more than 400,000 employees their salaries about 15 days early this month and helped facilitate share account-opening services in recent weeks for people interested in applying for the IPO, a person in the industry with direct knowledge of the situation said.

For the year to March, Jio Platforms reported a profit of about $3.2 billion on revenue of $15.5 billion. Around 90 per cent of both figures came from its telecoms business alone.

(With inputs from agencies)