Jio Platforms, the digital arm of Reliance Industries, is expected to list on the NSE and BSE on Wednesday, 28 October, after an initial public offering that ran from 21 to 23 October. The issue was a fresh sale of up to 27 crore shares in a price band of Rs 1,065 to Rs 1,119, worth up to Rs 30,213 crore at the top of the band, with no shares sold by existing holders. It is larger than the Rs 27,870 crore Hyundai Motor India issue of 2024, which makes it the biggest public offer the Indian market has seen. The listing date is tentative, according to broker listings, and should be confirmed with the exchanges. The debut will be a test of how much appetite there is for a very large offer in a weak market.
The argument that demand was strong begins with the anchor book. Jio Platforms allocated Rs 8,109.84 crore to 212 anchor investors before the issue opened, and bids for the anchor portion were reported to be worth about Rs 2.5 lakh crore, more than 30 times the amount on offer. The Life Insurance Corporation took Rs 499.98 crore of the anchor allocation. On the first day, the portion reserved for qualified institutional buyers was subscribed 4.10 times by midday, according to HDFC Sky. The business behind the issue is large too: Reliance said in July that Jio's subscriber base had crossed 533 million, including 285 million 5G users, which gives the listed company a very wide customer base.
The argument that the response was uneven starts with retail investors. By midday on the first day, retail investors had bid for only 0.42 times the shares reserved for them, against 4.10 times for institutions, so individual savers were far slower than funds. The market backdrop was also hard. The Sensex fell 143.21 points to 73,709.69 on 21 October, its second straight loss, with foreign investors selling and Brent crude above $110 a barrel, and the benchmarks had only recently ended an eight-week losing streak, the longest in about 25 years. Asking investors to commit Rs 30,213 crore in that setting raises the risk that the shares open below the issue price. Early-day figures also differ between reports, so final numbers should be checked against the exchange and the registrar.
The listing matters well beyond Reliance. A strong debut would show that very large issues can still be absorbed when the market is falling, and it would encourage other big companies to bring their offers forward. A weak one would put pressure on the pipeline of issues planned for the coming months. For households that hold Reliance through mutual funds and pension plans, Jio's value also feeds into the parent's share price. The Reserve Bank's rate hike to 5.50 percent and a rupee near 95 make the timing harder, since both raise the cost of money for investors.
Jio Platforms has the anchor interest and the subscriber numbers to support its price. Whether retail investors, who were slow at the start, join in after the listing will decide how the first day is remembered.
Featured image: The Jio World Centre in Mumbai (file photo). Photo: DesiBoy101, CC BY 4.0, via Wikimedia Commons.