Reliance Industries announces plans for Jio

Reliance Industries announces plans for Jio

According to reports in London’s Financial Times and the Economic Times of India Reliance Industries has some interesting plans for its Jio mobile business.

Reliance Industries aims to separate Jio, launched in 2016 and today one of the largest telecoms ventures in the world, into a new company. It will then invest some $15bn in the new company, cutting its massive debt. This in turn will help to enable plans to list Jio within five years.

Reliance took on a lot of debt to fund Jio — a very aggressive player in the Indian mobile market that has quickly attracted over 350 million users. According to the FT the group’s net debt was $22bn by the end of March this year.

According to the Economic Times this move by owner Mukesh Ambani, Asia’s richest man, is the latest sign of a change of focus for his company, known for a diverse portfolio that includes oil and petrochemicals, towards data and digital services for future growth, as it builds an online platform with a strong retail focus.

In fact Ambani has also announced that some 20 percent of Reliance’s oil and chemicals business is to be sold to Saudi Aramco, a massive – and massively profitable – Saudi Arabian national petroleum and natural gas company, at an enterprise value of $75 billion.

What plans Reliance has for its mobile business beyond ridding it of debt are hard to guess, though its attractiveness to investors as a debt-free company in a highly competitive market with 5G on the way would surely be enormous.