Reliance plans to take Jio public next year “once the company becomes debt-free”

By Jit Kumar
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After signing back-to-back deals with three US-based firms in April-May, India’s billionaire businessman Mukesh Ambani-owned oil-to-telecom conglomerate Reliance Industries is now planning to list its telecom unit Jio as a separate digital company on the country’s bourses next year, the Indian Sun has learned.

Despite being a late entrant to India’s telecom sector, Jio has till date attracted some 370 million subscribers to its network since its mega launch in 2016. By offering free voice calls and low data prices, it has in fact changed the country’s digital landscape.

Sources say the top management of Reliance Industries is now chalking out a strategy to take Jio public by end of next year, “once the parent company becomes debt-free by March 2021”. “Such as announcement is likely at the annual general meeting next year, of course provided Ambani’s ambitions to cut the parent company’s net debt to zero by the end of this fiscal becomes a reality,” sources say.

Well, Reliance’s recent deals with global technology giant Facebook, and equity firms Silver Lake and Vista, between 22 April and 8 May are a major step towards that direction only, analysts believe.

“Jio’s valuation is now USD 65 billion, which is half the market value of its parent company. There are also reports that Reliance’s talks with Saudi Aramco are progressing”

First was Facebook’s decision to invest USD 5.7 billion in Reliance, making the social networking giant the Indian conglomerate’s largest minority shareholder, with a 9.99% stake. Then came the announcement of private equity firm Silver Lake’s investment of USD 747 million in Reliance. The latest was Vista’s USD 1.5 billion investment in Jio platforms in lieu of a 2.3% stake.

“By sealing these three deals at a time when the entire world is reeling under coronavirus crisis, Reliance has managed to raise a combined USD 8 billion. Jio’s valuation is now USD 65 billion, which is half the market value of its parent company. There are also reports that Reliance’s talks with Saudi Aramco are progressing. So, if all goes all, an initial public offer from JIO is inevitable next year,” says Ajai Misra, a telecom veteran based in Delhi.

The Indian Sun has earlier reported about Reliance’s talks with some fast moving consumer goods (FMCG) companies in this country to deliver daily use domestic essentials at the doorsteps of consumers, a development that followed Facebook’s chat service WhatsApp’s tie-up with Ambani’s e-commerce venture JioMart to make consumers connect with local groceries for buying products.

As per consulting firm PricewaterhouseCoopers, the number of internet users in India is likely to grow to 850 million in 2022.


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