Jio IPO: Mukesh Ambani's telecom giant seeks Rs 11 lakh crore valuation

Jio Platforms, the telecom and digital services arm of Reliance Industries, is likely to seek a valuation of around Rs 11 lakh crore ($114 billion) in its planned initial public offering, potentially making it one of India's biggest-ever listings, reported Bloomberg.

The proposed valuation is lower than some of the much higher estimates discussed earlier, including expectations of $130 billion-$170 billion at one point. The company has completed demand assessment for the offering and is likely to begin meeting potential investors this week to discuss valuation and pricing, the report said.

Jio is looking to open its IPO in the week of October 19 and list before October 30, although the dates, valuation and other details could still change, according to the report.

Meanwhile, grey-market tracking data showed Jio Platforms' latest grey market premium (GMP) at Rs 156 as of 1:02 pm on October 6. The tracker showed an estimated listing price of Rs 156 based on the available GMP data.

GMP is an unofficial indicator of investor sentiment before an IPO listing and is not an indication of the actual listing price.JIO COULD BE INDIA'S THIRD-LARGEST LISTED COMPANY

At a valuation of around $114 billion, Jio would rank as India's third-most valuable publicly traded company if it were listed at that valuation.

Its parent Reliance Industries has a market capitalisation of around $169 billion, while telecom rival Bharti Airtel is valued at about $116 billion, according to Bloomberg.

The proposed valuation therefore puts Jio's potential market value close to that of Airtel, despite Jio currently being part of the privately held Reliance group.WHY JIO'S IPO VALUATION MATTERS

Jio's proposed $114 billion valuation is below the $130 billion-$170 billion range that had been discussed earlier.

The company filed its draft prospectus in June for an offering of as many as 270 million new shares, equivalent to about 2.93% of its post-issue equity capital, according to Bloomberg's calculations.

The more modest valuation comes at a time when a stock-market sell-off has affected the pricing of several IPOs in India.

The planned National Stock Exchange of India IPO, for instance, had to be downsized amid the weaker market conditions.

Motilal Oswal Financial Services had estimated Jio's valuation at $115 billion-$118 billion in June, while Dolat Capital had valued the company at around $110 billion.JIO IPO COULD STILL BREAK RECORDS

Even at a $114 billion valuation, the proposed share sale could become India's biggest IPO by funds raised.

The shares being offered would be worth about $3.4 billion, according to the report.

That would surpass the Rs 27,870 crore ($2.9 billion) raised by Hyundai Motor's Indian unit in 2024, which currently ranks among India's largest IPO fundraises.

The final size of the issue and pricing, however, could change as discussions with investors progress.JIO IPO COMES AMID RECORD IPO FUNDRAISING

Jio's planned offering comes during a particularly active year for India's IPO market.

Companies raised more than $9 billion through listings in the July-September quarter, the highest ever for the period, according to Bloomberg data. Total fundraising through IPOs so far this year had crossed $13 billion.

Jio has appointed 19 banks to work on the share sale. The syndicate includes Kotak Mahindra Capital, Morgan Stanley, BofA Securities, Axis Capital, BNP Paribas and Citigroup.WHAT THE JIO IPO COULD MEAN FOR INVESTORS

For investors, the key numbers to watch will be the final IPO valuation, issue price and the premium or discount at which the shares are eventually priced.

The current GMP of Rs 156 provides an indication of grey-market sentiment, but it should not be treated as a guaranteed listing price or a formal market valuation.

The final valuation will also depend on the investor meetings expected to begin this week and the demand that Jio sees for the offering.

If the current timeline holds, Jio could open its IPO in the week of October 19 and complete its stock-market debut before October 30.

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