Shares of billionaire Mukesh Ambani’s Reliance Jio Platforms soared 21% in their Mumbai debut on Wednesday, valuing India’s largest telecom and digital services company at about $131.5 billion and making it the country’s second-largest company by market capitalisation.
The listing marks the first major public offering from the Reliance conglomerate in two decades and advances Ambani’s ambition to transform the oil-and-chemicals group into an “everything company” spanning consumer products and technology.
Jio Platforms offered 270 million shares at ₹1,119 apiece, raising ₹302 billion ($3.2 billion) in India’s largest-ever initial public offering (IPO).
The issue attracted substantial investor demand, with subscriptions exceeding 22 times the shares on offer, according to data from the BSE.
The qualified institutional buyers’ portion was subscribed 70.55 times, while retail investors subscribed 2.72 times.
The IPO was fully subscribed within 95 minutes of opening on October 21, Akash Ambani, Jio Platforms’ managing director and Mukesh Ambani’s eldest son, said ahead of the listing.
Including anchor investors, the offering attracted demand worth $78 billion and nearly 1.39 crore applications.
Global funds, including BlackRock, Capital Group and Singapore’s GIC, participated in the anchor book, which is reserved for institutional investors before public bidding begins.
Brokerages see further upside
The strong debut was followed by positive assessments from brokerages, which expect tariff increases, broadband expansion and improving cash generation to support Jio’s earnings growth.
Nomura initiated coverage with a Buy rating and a price target of ₹1,340, implying an upside of nearly 20% from the IPO price.
The brokerage expects steady tariff hikes and growth in home broadband to strengthen the company’s revenue prospects.
Nomura identified home broadband as Jio’s second growth engine, supported by its extensive network infrastructure and market leadership.
It also expects free cash flow to improve sharply as capital expenditure intensity declines.
The bulk of Jio’s 5G-related investments has largely been completed, according to the brokerage, potentially allowing the company to benefit from its infrastructure spending while generating stronger cash flows.
Motilal Oswal Financial Services also initiated coverage with a Buy rating, setting a target price of ₹1,350 per share, implying an upside of about 21% from the IPO price.
The domestic brokerage expects tariff hikes, subscriber additions, home broadband expansion and growth in digital services to drive earnings over the next three years.
However, Jio’s shares were last trading at ₹1,357, above both brokerages’ target prices.
Investors will assess whether the company’s earnings growth and cash generation can justify the premium established during its debut.
Mahesh M Ojha, vice president of research and business development at Kantilal Chhaganlal Securities, said: “The firm’s robust compounding potential justifies a definitive buy-and-hold strategy for long-term wealth creation”.
Competition and valuation remain key risks
Despite the positive outlook, analysts cautioned that the listing gains do not necessarily indicate the stock’s longer-term performance.
“The IPO price offered a valuation entry point; the listing price reflects a much greater degree of optimism,” said Aishvarya Dadheech, founder of Fident Asset Management.
Motilal Oswal flagged intense competition, the capital-intensive nature of telecom operations, technological disruption and regulatory uncertainty as potential risks.
Jio’s dependence on Reliance Industries group entities and material related-party transactions are also factors investors are monitoring.
Delays in tariff increases, stronger competitive pressure, higher-than-expected capital expenditure or slower growth in digital platforms could weigh on earnings and valuations.
The brokerage has not factored in a significant contribution from Jio Platforms’ international initiatives, leaving room for additional upside if those ventures gain traction.
Seema Srivastava, senior research analyst at SMC Global Securities, also cautioned investors about valuation risks, competition from Bharti Airtel, substantial capital expenditure requirements and uncertainty over how quickly newer businesses can be monetised.
“Strong IPO demand and expectations of listing gains do not guarantee a sustained post-listing rally,” Srivastava noted.
Focus shifts to earnings and cash generation
Jio’s telecom business serves more than 530 million customers, making it the world’s second-largest mobile operator by subscriber numbers within a single country, behind China Mobile.
The company is also backed by Meta Platforms and Alphabet’s Google, reflecting its significance in India’s digital economy.
The listing is an important milestone in Ambani’s efforts to expand Reliance beyond its traditional energy businesses and strengthen its presence in technology and consumer-facing services.
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