Jio Platforms Shares Surge 21.5% in Historic Indian Debut
The telecom giant raised $3.2 billion in the country's largest IPO, securing a market cap of $131 billion.
By Kwame Silva ·
India's largest initial public offering concluded with a sharp rally as Jio Platforms shares jumped 21.5% on Wednesday. The stock climbed following the sale of 270 million shares, which generated 302 billion rupees for the company. This transaction stands as the largest capital raise in the nation's history.
Trading data from the National Stock Exchange places Jio Platforms' market capitalization at 12.5 trillion rupees, equivalent to $131 billion. This valuation positions the company as the second most valuable firm in India, trailing only its parent, Reliance Industries. The high valuation also qualifies the stock for potential inclusion in major global benchmark indices.
The offering faced intense competition from buyers. BSE data indicates the issue was subscribed more than 22 times overall. Institutional investors drove the majority of this demand, with the qualified institutional portion subscribed 70.55 times. Retail investors participated at a 2.72 times subscription rate. Akash Ambani, managing director of Jio Platforms and son of Reliance Industries head Mukesh Ambani, noted that the issue sold out within 95 minutes of opening on Oct. 21.
Market analysts anticipate the stock will soon join key indices like the MSCI and Nifty 50. Deven Choksey, founder of DRChoksey FinServ, told CNBC that such inclusion should create enough buying pressure to offset any selling from early investors. Choksey suggested that some shareholders who acquired stakes around 2021 may look to exit in approximately six months.
Nomura initiated coverage on the stock with a buy rating on Wednesday. The brokerage set a target price of 1,340 rupees, suggesting 19.7% upside from the IPO price of 1,119 rupees. In its report, Nomura stated that Jio's major capital spending cycle is largely finished. The firm expects a sharp improvement in free cash flow as a result. Shares closed the session at 1,360 rupees.
Reliance Industries retains control of the company with a stake exceeding 66%. Other major shareholders include Jaadhu Holdings, an affiliate of Meta Platforms, which owns nearly 10%, and Google International, which holds 7.7%. Major global funds, including BlackRock, Capital Group, and GIC, participated in the anchor book. Including these large institutional investors, the total demand for the shares reached $78 billion.
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