Reliance Industries' telecom and digital arm Jio Platforms has received Sebi approval for its IPO, bringing one of India’s most-awaited listings closer to launch. The issue is expected to raise around Rs 37,700 crore and value the digital services company at nearly Rs 9.5 lakh crore, making it one of the largest public offerings in India.
RIL has confirmed in Jio Platforms' DRHP that the IPO will include a reservation for eligible RIL shareholders. However, the company has not yet disclosed how many shares will be kept aside under this category.
Reliance Industries shareholders may still have time to qualify for the reserved shareholder portion in the proposed Jio Platforms IPO, as the record date for eligibility has not yet been announced.
Eligibility will depend on the record date, which will be specified in the Red Herring Prospectus. Investors who hold Reliance Industries shares in demat form on that date will be eligible to apply under the shareholder quota.
The DRHP says the issue includes a reservation for eligible shareholders, with details to be filled in later. This means investors looking at the shareholder quota should watch the RHP, not just the Sebi approval. The RHP will give the final IPO details including issue size, reservation size and record date.
If an investor holds RIL shares in demat form on that date, they can apply under the shareholder category. If they buy after the record date, they will not be eligible for that quota, even if they hold the shares before the IPO opens.
Also Read: Jio IPO soon! Reliance's telecom arm gets Sebi nod for Rs 37,700 crore offering
A shareholder quota is a reserved category within an IPO for existing shareholders of the parent company. In this case, it would apply to eligible Reliance Industries shareholders.
It does not replace a retail application. An eligible investor can apply under the shareholder category and may also apply under the retail category, subject to IPO rules and application limits. This gives shareholders a second route to seek allotment.
In many large and heavily subscribed IPOs, the shareholder category can sometimes have less competition than the general retail category. But that depends on the size of the reservation and the number of eligible shareholders who apply.
For Jio, those details are not yet available. The DRHP confirms shareholder reservation, but does not give the quantum of shares reserved for RIL shareholders. Investors will have to wait for the RHP for that.
The Jio IPO will be entirely a fresh issue of up to 27 crore equity shares of face value Rs 10 each, with no offer-for-sale component, according to Reliance’s earlier exchange disclosure. That means the IPO proceeds will go to Jio Platforms and not to selling shareholders.
According to the DRHP, Jio Platforms plans to use Rs 27,500 crore from the IPO proceeds to prepay certain borrowings of Reliance Jio Infocomm. The balance proceeds will be used for general corporate purposes.
Why Jio IPO matters for RIL
Reliance Industries Chairman Mukesh Ambani has described the Jio listing as an important value creation milestone for Reliance shareholders. The listing is expected to unlock value in Reliance’s digital business, which has become one of the group’s largest growth engines.
Reliance Industries is Jio Platforms’ largest shareholder with a 66.43% stake. Meta, through Jaadhu Holdings, owns nearly 10%, while Google International holds 8%. Other investors include Saudi Arabia’s Public Investment Fund, KKR-linked Omicron Asia Holdings II, Vista Equity Partners, Mubadala, General Atlantic and Platinum Jasmine.
The IPO is expected to be one of India’s largest public issues. If the reported Rs 37,700 crore size holds, it could rank above Hyundai Motor India’s share sale and become the country’s biggest IPO.
