Jio’s next big disruption

Jio Platforms is set for a spectacular debut on the stock exchanges.

There has been huge investor interest in the issue. And many marquee institutions have expressed interest in coming in as anchor investors. And with the huge following that Reliance has traditionally had amongst retail investors, the issue is set to be oversubscribed several times over. And while it may be smaller than the Hyundai issue, which was India’s largest ever, it is important to note that there are no selling shareholders, and the entire Rs30,213 crore raised will be infused into the company. All the global investors who had invested in 2020, like Google, Meta, Mubadala, ADIA, KKR and General Atlantic, will remain invested in the company, with none choosing to exit through the listing. Overall, it is bound to be a huge success. Upon listing, Jio Platforms will be amongst the top half a dozen companies by market cap in India.

All this in the 10 years since Jio entered the telecom market in 2016.

When Reliance Jio entered the telecom market, it didn’t offer just another mobile connection. It challenged and changed the economics of connectivity. With cheap data, aggressive pricing and a nationwide network, it triggered a brutal price war that forced the whole industry to reinvent itself.

With the average cost of data at Rs228, and a monthly data consumption of 0.2 GB, the industry as a whole moved to an average consumption of 25GB at an average price of Rs 7.9.

The smartphone became more than a telephone. It became a classroom, cinema, marketplace, news channel, and a window to the whole of India and the world.  It allowed those in the cities, or even overseas, to video-call their relatives in villages, and it allowed advances in governance and in providing services to citizens. And without it, there could have been no digital payments platform, which is now the world’s largest. All of these have changed the lives of hundreds of millions of Indians. This is how far the industry as a whole has changed. It would be fair to say that without Reliance relentlessly forcing the pace for 10 years, this completely new order would have taken much, much longer.

Mukesh Ambani deserves full credit for the amazing growth of Jio. He is the prime architect of the Jio empire. It is his original overarching vision and thesis, mastery of the technologies involved, meticulous execution, taking the enormous financial risks and building strategic relationships. While he had several advantages, including the cash flow from the oil and petrochemical business, in 2020, when Reliance’s peak debt stood at approximately Rs 1,56,000 crore, several market observers felt he had bet the whole of Reliance on Jio. Yet he surprised all when, during Covid he raised over Rs 1,50,000 crore from the marquee investors to make Jio free of net debt. 
He has now brought in the next generation to take charge. Akash is the managing director. He is increasingly the leader of Jio. He oversees its products, technology agenda, operations and customer relationships, while Mukesh himself remains chairman.  
In spite of the great success, the Ambanis have ambitious plans ahead, beyond mobile connectivity. They are looking to export their software-based 5G technology and are getting ready to be at the forefront of the evolution of 6G. They want to grow into cloud and enterprise technology. And they are thinking of AI and data centres, with the first data centre already underway in Jamnagar. There are exciting times ahead for Jio Platforms.