Jio IPO: Grey market signals 20% premium; brokerages flag risks

Jio Platforms’ Rs 30,200 crore initial public offering is attracting a grey market premium of Rs 221 per share ahead of its scheduled October 21 opening, Economic Times Markets reported on October 17. Against the price band’s upper limit of Rs 1,119, that implies an unofficial price of Rs 1,340—nearly 20% higher. It is an indication of grey market sentiment, not an assured listing return.

The reported offer price is Rs 1,065–1,119 per share, with bidding due to close on October 23. The issue comprises 27 crore fresh shares. Jio Platforms plans to direct Rs 27,500 crore towards repaying or prepaying borrowings; its estimated post-issue market capitalisation at the upper price is Rs 10.30 lakh crore.

Emkay backs subscription on scale and earnings growth

Emkay Global recommends subscribing, pointing to Jio’s leading telecom position and opportunities in home broadband, enterprise connectivity and digital services. Through Reliance Jio Infocomm, the business had 533.3 million customers as of June 2026, with reported shares of 50% in wireless broadband subscribers and 42.6% in fixed broadband subscribers. Its network handles about 60% of India’s wireless data traffic.

Between FY24 and FY26, revenue expanded at a compound annual rate of 15.8%, while EBITDA and profit after tax grew at annualised rates of 16.2% and 18.4%. Average revenue per user increased from Rs 181.7 to Rs 214 over that period, alongside 42.6 million subscriber additions.

Emkay’s growth case extends beyond mobile subscriptions. It includes greater 5G adoption, migration from 2G to newer networks, home broadband expansion and managed services for enterprises and small businesses. Jio also plans to sell its proprietary technology stack to telecom operators outside India.

Technology investment broadens the business

Jio’s digital offerings cover entertainment, gaming, cloud computing, smart-home services and artificial intelligence-enabled platforms. Its enterprise portfolio includes private 5G, cloud, cybersecurity and managed network services.

In the first quarter of FY27, 12,477 employees—about 45% of its workforce—worked on digital products and technology development. Jio Platforms and its subsidiaries had filed 7,220 patent applications by that period, including 2,655 in India and 4,565 overseas.

The IPO note puts Jio’s 5G customer base at 284.9 million in the first quarter of FY27, ranking it third globally. Its spectrum holdings total 26,800.8 MHz, with an average remaining life of 16 years.

Cash generation supports the debt-repayment case

Reported FY26 operating cash flow was Rs 77,556 crore and free cash flow was Rs 43,301 crore. EBITDA rose from Rs 54,341 crore in FY24 to Rs 73,382 crore in FY26, while profit after tax increased from Rs 21,422 crore to Rs 30,064 crore. The EBITDA margin moved from 49.6% to 50%.

Emkay expects cash generation to strengthen as the 5G investment cycle nears completion. The IPO note argues that repayment of Reliance Jio Infocomm’s borrowings should lower leverage and financing costs, leaving more flexibility for future investment.

Valuation estimates differ; risks remain

Emkay cites valuation multiples of 31.7–33.3 times FY26 earnings and 15–15.6 times FY26 EBITDA. SBI Securities estimates a post-issue FY26 price-to-earnings multiple of 34.4 times at the upper offer price, alongside enterprise value of Rs 20,117 per subscriber. These are separate brokerage estimates rather than a single agreed valuation.

Emkay flags spectrum costs, regulatory changes, competition that could constrain revenue per user, subscriber churn and dependence on Reliance Group entities. Other concerns include concentration among infrastructure and equipment suppliers, leverage and foreign-exchange exposure.

SBI Securities also highlights continuing capital expenditure requirements, reliance on infrastructure providers, cybersecurity and privacy threats, spectrum-licence dependence and possible network disruptions. The brokerage assessments and unofficial premium should not be read as guarantees of investment performance.