Reliance Jio, India’s leading telecom operator, is gearing up for accelerated growth in its 5G-based fixed wireless access (FWA) business, Jio AirFiber. The company plans to significantly scale customer additions over the next year to drive 5G monetisation ahead of a highly anticipated initial public offering (IPO) by the end of 2025.
According to a reports, Jio aims to onboard one million AirFiber customers within just 30 days, leveraging the growing demand for high-speed internet and data consumption.
Jio’s intensified focus on expanding its AirFiber user base is being viewed as a strategic move to fuel excitement around its IPO. Analysts from brokerage firm CLSA highlighted in a recent report that these efforts are likely to bolster Jio’s valuation as it approaches its proposed listing.
In July 2024, Reliance Jio initiated steps to monetise 5G by raising the minimum plan threshold for its 5G mobile broadband services, requiring users to shift to higher-value plans. While the effects of these tariff hikes are expected to materialise fully in the Q4FY25 and Q1FY26 quarters, analysts believe the expansion of AirFiber’s high-ARPU (Average Revenue Per User) customer base will significantly accelerate revenue generation.
Jio’s push for faster monetisation of its 5G services is expected to translate into a stronger ARPU in the months ahead. The company’s financial metrics are projected to improve, enhancing its appeal to investors ahead of its IPO.
According to CLSA, Reliance Jio’s operating income (Ebitda) is expected to grow by 40% to ₹87,600 crore by FY27, driven by ARPU growth and subscriber additions. The report also estimates Jio’s ARPU to rise to ₹230 by FY27, compared to ₹195 in Q2FY25.
Jio Platforms Ltd (JPL), the digital and telecom arm of Reliance Industries, is valued at $98 billion by Sanford C Bernstein. Based on this valuation, Jio’s IPO could raise around ₹42,100 crore, making it India’s largest IPO ever.
For perspective, the largest IPO in India to date has been Hyundai India’s ₹27,856 crore offering in 2023. Current regulatory norms require companies valued at ₹1 trillion or more to sell at least 5% of their stake during an IPO.
Reliance Industries, led by Mukesh Ambani, currently holds a 66.5% stake in Jio Platforms, with the remaining 33.5% stake owned by strategic investors like Meta and Google (17.7%) and global private equity firms (16%). In 2020, JPL had raised over ₹1.52 trillion from these investors, showcasing significant backing for its growth ambitions.
Sanford C Bernstein predicts that Jio will achieve a 17% compound annual revenue growth rate (CAGR) over the next three years. This growth will be driven by a 14% ARPU increase in FY26 and expanding market share. By FY26, Jio is expected to capture 48% of the industry’s revenue, solidifying its leadership position in India’s telecom sector.
Reliance Jio’s strategic ramp-up of its AirFiber services underscores its commitment to capitalising on India’s 5G revolution. By targeting rapid customer acquisition and focusing on ARPU growth, Jio is positioning itself to not only drive faster 5G monetisation but also secure a robust valuation for its much-anticipated IPO.
With predictions of becoming India’s largest IPO, Jio’s growth story reflects its ambitions to dominate the telecom and digital services market. Backed by global investors and a strong market presence, Reliance Jio is poised to redefine industry benchmarks and further solidify its leadership in the years to come.