Billionaire Ambani cries tears of joy as Jio Platforms becomes the second most valued Indian firm
Ahead of Jio's listing, Mukesh Ambani teared up as his three children shared the journey of building Jio and vowed to create value for investors over the next 50 years.
Key points
- Jio Platforms listed at over 25% premium, reaching market cap of 13.05 trillion rupees ($137.1 billion).
- Reliance Industries owns more than 64% of Jio Platforms after the IPO.
- Analysts caution most value is priced in after listing gains, with future returns tied to revenue per user and AI services.
Mukesh Ambani now owns the two most valued companies in India after Jio Platforms, the country's largest telecom operator and digital services firm, made a strong market debut. Jio shares opened 3.3% higher on Thursday, a day after listing at a premium of over 25% to its IPO price.
The listing gave Jio Platforms a market capitalization of 13.05 trillion rupees ($137.1 billion). Ambani's flagship Reliance Industries, already India's most valued company, owns more than a 64% stake in Jio after the initial public offering.
Analyst outlook and debt reduction
Analysts expect Jio's free cash flow to improve significantly as IPO funds are used to repay legacy telecom debt and the company's 5G investment cycle slows. They cautioned, however, that most of the value has been priced in after the listing gains, with the company now valued on par with some global telecom giants.
Anurag Singh, founder and managing partner of U.S.-based Ansid Capital, told CNBC that with just 3% share dilution, Jio has wiped out nearly 300 billion rupees of debt. He added that Jio's current market cap puts it in the league of American telecom giants such as AT&T and Verizon Communications.
democratize every technology that can transform Indian lives
— Akash Ambani
Future plans and market impact
Akash Ambani, managing director of Jio Platforms and Mukesh's eldest son, said on Wednesday that in the next 10 years Jio will "democratize every technology that can transform Indian lives." He listed artificial intelligence, Cloud, connected devices and space connectivity as key future growth areas.
Vaqarjaved Khan, senior analyst at Indian broking firm Angel One, told CNBC that Jio brings "a rare scale to Indian equities," with more than half a billion customers, operating margins of 52% and net leverage of 0.36 times. After Jio's listing, Reliance Group's market value of 30 trillion rupees surpassed Tata Group's 25 trillion rupees, according to a Bloomberg report.
