MUMBAI: Reliance Industries Ltd (RIL) is exploring an initial public offering (IPO) for its Reliance Jio Infocomm unit in the latter half of 2020 at the earliest, according to people familiar with the matter. They added, however, that the first priority would be getting investors for the two infrastructure investment trusts (InvITs), which own the company’s tower and fibre assets.
Multiple meetings have taken place over the last month or so among company executives, bankers and consulta ..
“The telecom company has informed bankers that it expects to topple competition on the subscriber front shortly, which would bring in more revenue, and roll out its fibre to home (FTTH) network, all of which will ensure a successful IPO,” the person said.
The company was the only telco to post profits in the March quarter, up 65 per cent from the year earlier on a 56 per cent rise in revenue. But sequential profit growth was 1 per cent against 22 per cent in the preceding quarter, constrained by the ARPU fall and higher network and depreciation and amortisation expenses.
In a note after Jio’s fourth-quarter earnings, brokerage IIFL pegged the telecom unit’s enterprise value at around $63 billion (Rs 4.41 lakh crore). Rival Bharti Airtel ..
JP Morgan, in its latest report, said that earnings growth at parent RIL faces around 15 per cent “material downside risk” to the brokerage’s FY20 earnings estimates on weak refining and petrochemical margins. One way to help offset the weakness in its core business would be for Jio to increase tariffs by 12-20 per cent, it said.
RIL is said to have made clear in the discussions that an IPO will take place only after the company sees its recently demerged fibre and tower businesses — Ji ..
ICICI Securities declined to comment. Citi and Moelis didn’t respond.
In less than three years of operation, Jio has got 306.72 million users for a 26.4 per cent market share at the end of March. Crucially, in that quarter, Jio reported a 182 basis point sequential jump in revenue market share (RMS) to a 31.7 per cent share, compared with Airtel’s 27.3 per cent and market leader Vodafone Idea’s 32.2 per cent, brokerage Emkay Global said in a report. A basis point is 0.01 percentage poin ..
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