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Highlights
- Reliance Jio, India's largest telecom operator, will soon be proceeding with the Initial Public Offering (IPO).
- Jio's IPO will be an important one for the Indian stock exchanges, as well as Reliance Industries.
- Much recently, reports online suggested that the Reliance Jio IPO price band could be somewhere around Rs 1,350 to Rs 1,450.
Andrew Bonwick
Vice President of Product Development at Relm Insurance
Madhav Sheth
CEO of Ai+ Smartphone
Stephen Rose
CEO Render Networks
Reliance Jio, India’s largest telecom operator, will soon be proceeding with the Initial Public Offering (IPO). Jio’s IPO will be an important one for the Indian stock exchanges, as well as Reliance Industries. Much recently, reports online suggested that the Reliance Jio IPO price band could be somewhere around Rs 1,350 to Rs 1,450. Bharti Airtel, which is already a listed company, is trading at Rs 1800 levels. But it is never the price of a single share which determines the value of the company. It is the market cap which determines which company is more valuable.
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Jio Platforms Valuation vs Airtel Valuation
Jio Platforms is looking to raise about Rs 37,700 crore. This would make Jio’s IPO the largest ever in India. Jio is listing only about 2.9% of its stake in the public markets. Jio’s total market valuation, right after listing is expected to be in the range of $130-170 billion USD. Whereas, Airtel is today pegged at approximately $140 billion USD.
Jio could command a strong premium over Airtel simply because it is the market leader in almost every segment. Whether it is wireless or wireline, Jio is not only ahead, but ahead by a long margin. Sure, Airtel has a more premium customer base, but that does not mean Jio can’t earn in scale. Jio is not only earning money, but earning it more than Airtel.
Comparing the India specific business, Airtel, despite with a higher ARPU, reported a net profit of Rs 13,745 crore. At the same time, Jio reported a net profit of Rs 30,049 crore. This makes Jio the bigger and better player in a real sense.
