The initial public offer (IPO) of digital services company Jio Platforms Ltd, expected to be the country’s largest IPO, will open for subscription on October 21. According to the red herring prospectus (RHP) filed on Wednesday, the IPO will close on October 23 and bidding by anchor investors will take place on October 19. The company paid Rs. 50 crore shares and for employees Rs. For eligible shareholders of Reliance Industries Limited (RIL) Rs. up to 2,500 crores. Individuals and Hindu Undivided Families (HUFs) holding public equity shares of RIL till October 14 are eligible to apply under the shareholder reservation category, subject to applicable terms and conditions.

Keep track of price bands and valuations

Reuters had earlier reported that Jio Platforms is targeting a valuation of around $106 billion (i.e. around ₹10.3 lakh crore) and plans to raise around ₹30,200 crore at the upper end of the potential price band. This will be bigger than Hyundai Motor India’s 2024 IPO, which is currently India’s largest public issue.

As per the report, the price band per share is Rs. 1,065-1,119 is set, though investors will wait for final confirmation. At this valuation, once listed, Jio will become one of the most valuable listed companies in India.

Experts estimate that Rs. At a current valuation of Rs 10.3 lakh crore, Jio would trade at around 12 times estimated FY28 EV/Ebitda, while the figure for Bharti Airtel’s Indian business (excluding Indus Towers) is around 10.3 times.

Abhinav Tiwari, senior research analyst at Bonanza, said in an ET report that overall, the price looks reasonable for a slightly conservative rather than very low valuation. This valuation offers decent upside potential, increasing profits if earnings rise and tariffs increase.

Information on Reliance Jio IPO

The Jio IPO is a completely fresh issue, with no ‘offer-for-sale’ from existing shareholders. This means that Reliance Industries and Jio’s strategic investors – which include Meta, Google, Mubadala and Saudi Arabia’s Public Investment Fund – are not expected to sell shares in the offer. The proceeds from this will go to the Jio platform.

Earlier in media reports there was news that some existing investors may increase their stake in Jio Platforms in the IPO. Meta’s subsidiary Jadhu Holdings is the largest external investor with a 9.98% stake, followed by Google International with 7.73%.

The draft papers show that Rs. 27,500 crore of net proceeds will be used primarily to repay or prepay debt related to Reliance Jio Infocomm and the balance will be used for general corporate purposes. The Jio platforms comprise Reliance’s telecom and digital businesses, including mobile services, fixed broadband, cloud, entertainment, enterprise technology and AI services. As of March, the company had about 52.4 million customers.

According to reports, the Jio IPO has already received over $20 billion in bids from potential investors. It is said that global investors like Fidelity, Allianz and Capital Group, along with other international and local institutions have also shown interest in the offer.

Reliance Jio IPO GMP

Interest in the gray market has increased even before the filing. Jio shares at around Rs. 218 or trading at a premium of 19 percent, which means the price per share is Rs. 1,337 (based on the assumption that the upper limit of the IPO price band will be Rs. 1,119).

Jio is being presented as more than just a telecom company. Its businesses include mobile services, fixed broadband, cloud, entertainment, enterprise technology and artificial intelligence services.

Impact on RIL shares

For Reliance Industries, this IPO could create an independent market value for its most valuable growth business. If Jio is listed, investors will be able to value its digital platform separately, and not just through Reliance’s larger group structure, which also includes businesses such as oil-to-chemicals, retail and new energy.

However, the impact on RIL’s shares will depend on the final valuation, subscription demand, performance at the time of listing and whether investors feel the IPO can reduce Reliance’s holding-company discount. Analysts say the lower public float may mean less scope for immediate value unlocking, as Reliance will retain a majority stake in Jio even after the listing.