Global investors reached conclusion that RJio is king of Indian Telecom

New Delhi: Reliance Industries Limited (RIL) has monetized 22.4 of Jio Platforms and raised Rs 1.04 lakh crore and international investors have reached the conclusion that Reliance Jio is the new king of Indian Telecommunications, according to a research by brokerage firm, Bernstein.

"At our last model update in December, we proclaimed Reliance Jio the new King of Indian Telecommunications. Since then, we have seen a multitude of international investors reach the same conclusion," it said.

Facebook kicked-off the party, investing Rs 435.7 billion ($5.7 billion) to secure 9.99 per cent stake at a $65.95 billion pre-money enterprise value and this was closely followed by a further Rs 607.5 billion($8 billion) in investment spread across 8 different private equity investors.

All together, Reliance has monetized 22.4 per cent of Jio Platforms and raised Rs 1.04 trillion ($ 13.7 billion) in the process.

"While we expect strategic cooperation between Facebook and other parts of the Reliance Group, we believe most of the other investments are passive. Reliance gets access to much needed capital to assist in paying down debt, and these investors get early access to the leading Telco platform in India," the report said.

"We expect an IPO of Jio sometime over the next few years as its market share approaches 50 per cent. By then ARPUs will have improved and we expect service revenue will double over the next three years. Based on our updated model, we see potential upside of 30 per cent by FY25 at fair value. Returns will likely be higher as retail investors clamor to get a slice of what will be the undisputed scale player in Indian Telecoms," the report said.

"With all the positive news regarding investments in Jio Platforms you might expect we would become more optimistic regarding the value of the company. Instead we have become slightly more pessimistic about the near-term and have taken down our numbers," Jefferies said. (IANS)

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