The media is reporting a big move by the richest man of India as Mukesh Ambani, is planning to take his telecom company, Reliance Jio, to the stock market.
Reliance Jio Gearing Up For Biggest IPO Ever
It appears that Reliance Jio Platforms is considering an initial public offering (IPO) by selling around 2.5 per cent of the company as per the people familiar with the matter.
Moving ahead, the IPO could raise more than USD 4 billion (around Rs 37,000 crore), making it the largest IPO ever in India if this plan gets successful.
So far Reliance Jio has over 500 million users, so it won’t be an exaggeration to say that its listing is highly awaited by investors.
In the meantime, the investment bank Jefferies estimated Jio’s value at about USD 180 billion (around Rs 16 lakh crore) during November last year.
Some of the bankers now believe the company’s valuation could rise to USD 200-240 billion (nearly Rs 20 lakh crore).
Considering this level, selling just 2.5 per cent of the company would raise more money than Hyundai Motor India’s IPO, which collected around Rs 27,000 crore last year.
Selling a Smaller Stake to Keep Demand Strong
Earlier India’s market regulator, SEBI, has suggested a rule change for large companies by allowing them to sell a minimum of 2.5 per cent stake, instead of the current 5 per cent, at the time of an IPO.
Presently, the company is waiting for the Finance Ministry’s approval for this change.
It appears that the company prefers to sell a smaller stake to keep demand strong and avoid flooding the market with shares, said the sources.
The sources say that Morgan Stanley and Kotak Mahindra Bank have already started working with Reliance but no bank has been officially appointed yet.
They are also reportedly helping in preparing the draft red herring prospectus (DRHP) for the IPO.
Earlier during August last year, Mukesh Ambani said that Jio could be listed in the first half of 2026, although the final timing will depend on market conditions.
If we look into the last six years trends, Reliance Jio has raised large investments from global firms such as KKR, Silver Lake, and Google.
With this IPO, Reliance Jio could give these foreign investors an opportunity to sell their shares and exit the company, either fully or partially.
