Fundraising Spree for Reliance's Jio Platforms Values It at $65 Billion

5/23/2020 8:16:25 AM

23 May

Fundraising Spree for Reliance's Jio Platforms Values It at $65 Billion

Reliance Industries has raised $10 billion (roughly Rs. 75,869 crores) in just a month through five stake sales in digital unit Jio Platforms, whose valuation has surged to $65 billion (roughly Rs. 4.93 lakh crores).

That makes it India's second-most valuable stand-alone tech business after Tata Consultancy Services which is worth $99 billion (roughly Rs. 7.51 lakh crores).

  • Reliance Industries, controlled by Asia's richest man Mukesh Ambani, was worth about $129 billion (roughly Rs. 9.87 lakh crores) as of Thursday's close. Jio Platforms' valuation puts it just ahead of the combined value of the conglomerate's oil, gas, and other businesses.
  • The latest $1.5 billion (Rs. 11,367crores in India) investment comes on the heels of four other deals. Facebook led with a $5.7 billion (Rs 43,574 crores in India) purchase of a 9.99 percent stake. Vista Equity Partners has invested about $1.5 billion (Rs. 11,367 crores in India), General Atlantic invested roughly $850 million (Rs. 6,598 crores in India) and Silverlake put $750 million (Rs. 5,656 Crores in India).
  • After the latest sale, Reliance retains 83 percent of Jio Platforms.
  • The deals will help Reliance meet its goal of eliminating $21.4 billion (rooughly Rs. 1.6 lakh crores) in net debt by the end of the year.
  • Reliance's shares have tripled in value in the last three years coinciding with staggering subscriber growth at Jio Infocomm, which is now part of Jio Platforms.
  • The telecom carrier has notched up more than 376 million subscribers since its launch in late 2016, mainly at the expense of Vodafone Idea. Vodafone Idea lost a fifth of its wireless customers last year and had some 329 million subscribers as of January.
  • Reliance's oil and gas, refining and petrochemical businesses once underpinned the conglomerate's growth, but they have taken a sharp hit as oil prices collapsed. Weakness in those businesses led Reliance to post its worst quarterly profit fall in 11 years last month.
  • In addition to operating the world's biggest refining complex, Reliance also operates supermarkets and TV channels.

© Thomson Reuters 2020

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