The Jio Platforms IPO has attracted some of the world’s largest institutional investors, with demand in its anchor book reaching more than $25 billion, according to two sources cited by Reuters. Reliance, the conglomerate led by Indian billionaire Mukesh Ambani, said on Monday that Abu Dhabi Investment Authority (ADIA), BlackRock and Fidelity were among the investors that bid in the anchor round of what is set to be a record $3.2 billion offering.
The telecoms, cloud and artificial intelligence group opened the offering to institutional investors on Monday. Anchor investors can bid for up to 30 percent of the issue, which is earmarked exclusively for them, before the offer opens for public subscription on Wednesday.
Demand Far Exceeds the Quota Reserved for Anchor Investors
A company filing showed that Jio Platforms allocated shares worth more than 81 billion rupees ($853.31 million) to anchor investors. A source told Reuters that the bids drawn were more than 30 times the quota reserved for this category, an indication of how heavily the Jio Platforms IPO has been oversubscribed at this early stage.
The list of allottees extends well beyond the three firms named in the company’s statement. State-run insurer Life Insurance Corporation, French lender BNP Paribas, JPMorgan and HDFC Bank, India’s largest private-sector lender, were also allotted shares in the anchor book. The mix of sovereign wealth, global asset managers, banks and domestic institutions suggests broad confidence in the company’s prospects.
Valuation and Use of Proceeds
Jio is set to raise up to $3.2 billion at a valuation of $108.3 billion, according to Reuters. Press reports on the offer terms indicate that the issue is a fresh issue of shares rather than a sale by existing shareholders, with a price band of 1,065 to 1,119 rupees per share, a subscription window of October 21 to October 23 and a tentative listing date of October 28. These details have been reported by financial platforms and may be revised, so investors should consult the company’s prospectus for confirmed terms.
According to the company’s filing, Jio plans to use up to 275 billion Indian rupees ($2.90 billion) of the net proceeds to repay or prepay borrowings of its telecom subsidiary, Reliance Jio Infocomm. The figures were converted at a rate of 94.9475 rupees to the dollar.
A Test of Investor Appetite for Scale, Cloud and AI
Reliance Jio upended India’s telecoms market in 2016 by offering free voice calls and cheap data, and it soon became the country’s largest mobile operator. It now has more than 500 million subscribers and competes with Bharti Airtel and Vodafone Idea. The business is led by Akash Ambani, the son of Mukesh Ambani, and operates the telecom and digital businesses of Reliance Industries, spanning mobile services, fixed broadband, cloud, entertainment, enterprise technology and AI offerings.
The listing is therefore seen as a test of what global investors are willing to pay for that scale, and for the group’s expansion into cloud computing and artificial intelligence. A successful offering would place Jio Platforms among the top four Indian listed companies by market capitalisation, behind its parent Reliance, its rival Bharti Airtel and HDFC Bank.
Momentum in the Indian IPO Market
The Jio Platforms IPO follows the September listing of the National Stock Exchange of India, which underscored investor appetite for large offerings in the Indian IPO market. Year-to-date proceeds from Indian IPOs rose 8.3 percent to $12.65 billion compared with the same period last year, according to LSEG data. Hence, the Jio offering, at $3.2 billion, would represent a substantial share of annual fundraising by itself.
It will also be the first offering by Reliance since its listing of Reliance Petroleum in 2006, which adds a historical dimension to a transaction already notable for its size.
What Comes Next
The focus now turns to retail and non-institutional demand when the issue opens on Wednesday. Strong anchor participation does not guarantee the same response from the wider market, but it typically signals institutional conviction in the pricing. In this regard, the quality of the names in the Jio Platforms IPO anchor book, together with demand of more than 30 times the reserved quota, gives the offering a strong start.
Investors considering participation should note that the offering carries market risk, and that this article does not constitute investment advice.
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