Shares of Jio Platforms, the Indian telecoms and digital services company backed by Meta and Google, rose 21.4% in their market debut on Wednesday. The gain followed a record initial public offering (IPO), which was met with enthusiasm from both retail and institutional investors. The company, the largest in its sector in India, offered 270 million shares at 1,119 rupees each, raising 302 billion rupees ($3.2 billion) in the largest IPO ever carried out in the country.
The public offering was oversubscribed more than 22 times, with institutional investors leading demand, according to data from BSE. The portion allocated to qualified institutional buyers was oversubscribed 70.55 times, while retail investors oversubscribed it 2.72 times. Akash Ambani, managing director of Jio Platforms and son of Indian billionaire Mukesh Ambani, said before the listing that the IPO had been fully subscribed within 95 minutes of its opening on October 21.
Global brokerage Nomura gave Jio Platforms a “buy” rating on Wednesday, setting a target price of 1,340 rupees, implying a 19.7% increase from the IPO price. In a report, the brokerage noted that Jio’s capital expenditure (capex) cycle has largely ended and that a significant improvement in the company’s free cash flow is expected. The shares were recently trading at 1,357 rupees.
Reliance Industries, the flagship company of Indian billionaire Mukesh Ambani, owns more than 66% of the shares in Jio Platforms. It is followed by Jaadhu Holdings, a subsidiary of Meta Platforms, which holds nearly 10%, and Google International, with 7.7%, according to LSEG data. Well-known global funds such as BlackRock, Capital Group and GIC took part in Jio’s anchor book, which is reserved for large institutional investors before the public offering opens. Including anchor investors, the share offering generated demand of $78 billion.
Source: CNBC