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In India, a Facebook-led investment spree for Mukesh Ambani’s Jio Platforms
- In less than eight weeks, the digital arm of oil-to-retail giant Reliance Industries has attracted more than US$13 billion in investment
- Market dominance and its potential to grow are some of the biggest lures, though analysts say it’s also a bet on the acumen of India’s richest man
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Jio Platforms has only been around in its current form since November, yet the digital arm of oil-to-retail giant Reliance Industries – whose chairman Mukesh Ambani is India’s richest man – has attracted almost US$13.5 billion in investment in the past eight weeks alone.
As a wholly owned subsidiary, it was created to comprise Reliance’s telecoms division Jio Infocomm – the third largest mobile network operator in the world – as well as its music and video streaming apps.
Facebook was one of the first heavy hitters to take a stake, as part of a US$5.7 billion deal signed in April, closely followed by a slew of private equity funds including US-based TPG and L Catterton with US$598 million and US$249 million investments, respectively. In all, nearly 22 per cent of Jio Platforms has been snapped up so far, giving the unit an enterprise value of US$67.87 billion, according to Reliance.
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Hemang Jani, an equity strategist at Mumbai-based Motilal Oswal Finance Services, said the development of Jio Platforms would be interesting to watch “because of the ecosystem Reliance is going to build”.
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“From what we sense, total market size could be more than US$5 billion, realigning sectors like digital payments, retail, commerce, content and advertising,” he said.
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