How Jio IPO will change stakes of Meta, Google
What's the story
Jio Platforms, a subsidiary of Reliance Industries, is set to launch India's largest-ever public issue with an initial public offering (IPO) worth over ₹30,000 crore. The company's proposed IPO will dilute the percentage stakes of existing investors such as Reliance Industries itself, Meta, and Google. However, it's important to note that their share counts will remain unchanged post-IPO.
Stake dilution
Reliance Industries' stake to reduce from 66.35% to 64.41%
After the IPO, Reliance Industries' stake in Jio Platforms will reduce from 66.35% to 64.41%.
However, the total number of shares held by the company will remain unchanged at around 593.7 crore shares.
Meta Platforms' affiliate Jaadhu Holdings will see its stake diluted to 9.68% post-issue, even as its absolute holding stays intact at approximately 89.2 crore shares.
Google International's shareholding will stand at 7.49%, followed by Saudi Arabia's Public Investment Fund (PIF) and KKR subsidiary Omicron at 2.24% each.
Stake adjustments
Other existing investors' stake reductions
SLP Redwood's stake will be reduced to 1.83%, while Mubadala Investment's MIC Redwood will have a stake of 1.80%.
General Atlantic's stake will reduce to 1.30% and Abu Dhabi Investment Authority's stake will reduce to 1.12%.
TPG Capital's stake will also see a reduction post-IPO, with the exact percentage being 0.90%.
Valuation insights
Proposed IPO values Jio Platforms at over ₹10.3 lakh crore
The proposed IPO values Jio Platforms at over ₹10.3 lakh crore, more than double the valuation at which several financial and sovereign investors invested in 2020.
Google's investment was made at a valuation of about ₹4.36 lakh crore.
The fresh issue will expand Jio Platforms' total equity base, reducing the proportion of the company owned by existing shareholders even though their individual share counts remain unchanged.
Business expansion
Jio Platforms and its significance for Reliance Industries
Jio Platforms operates Reliance's digital and telecom businesses, including mobile services, broadband, cloud, entertainment, enterprise technology, and AI-linked platforms.
The company is positioning itself as a broader consumer technology and digital infrastructure play with its IPO which opens on October 21.
Reliance Industries holds about two-thirds of Jio Platforms, and investors have long viewed a separate Jio listing as a key value-discovery event for the conglomerate.