Reliance Jio's IPO could be the largest in the history of the Indian stock market. Mukesh Ambani's Reliance Industries Limited (RIL) is preparing to list its telecom branch, Jio, on the stock exchanges.
Reliance Jio IPO: Thursday witnessed a significant surge in the stock market, with the Nifty index reaching the 24200 level. Positive auto sales figures boosted market sentiment, encouraging increased buying activity among investors. Meanwhile, reports suggest that Reliance Jio's IPO is nearing finalization.
Reliance: India's Largest IPO
Reliance Jio's IPO is projected to be the largest ever in the Indian stock market. Reports indicate that Reliance Industries Limited (RIL)'s telecom arm, Reliance Jio, is preparing for its stock exchange listing, potentially raising approximately ₹35,000-40,000 crore (approximately $4.2 billion - $4.8 billion USD based on current exchange rates).
Estimated IPO Details
Reports estimate Reliance Jio's valuation at $120 billion, with the IPO expected in the second half of 2025. The IPO will involve a sale of existing shares alongside new share issuance, and a pre-IPO placement for select investors is also planned. The company has initiated discussions for pre-IPO placement, but the final ratio of existing to new shares is yet to be determined. However, no official information regarding this IPO has been released by Reliance Industries.
Reliance Jio IPO: India's Biggest IPO
If Reliance Jio's IPO proceeds with ₹40,000 crore, it will surpass Hyundai India's ₹27,870 crore IPO in 2024, becoming India's largest IPO. This could positively impact Reliance Jio and Reliance Industries' share prices.
IPO's Impact on Reliance Industries' Shares
This IPO could act as a catalyst for Reliance Industries' shares. The company's shares experienced their first loss in over 10 years. By the end of 2024, Reliance shares had fallen approximately 6%. On Thursday, Reliance Industries' shares closed at ₹1,240.55.
Jefferies and Tariff Hike Impact
In July 2024, Jefferies projected Reliance Jio's listing at a valuation of $112 billion. Recent tariff hikes have solidified Jio's leading market position. Notably, feature phone tariffs remained unchanged despite the hikes, focusing on monetization and market share. This positive development could further enhance the IPO's prospects.
Internal Challenges within the Telecom Industry
However, intense competition within the telecom industry could lead to price wars, potentially impacting ARPU (Average Revenue Per User). Furthermore, maintaining market share necessitates increased competition among companies, which could potentially affect revenue.
