India’s largest IPO made a strong but measured debut on Wednesday. Jio Platforms opened 21.36% above its issue price, almost exactly where the grey market had pointed, giving investors a solid gain on an issue that drew record demand.
Jio Platforms shares listed at ₹1,358 on both the National Stock Exchange and the BSE on Wednesday, 21.36% above the issue price of ₹1,119.
For allottees, that means a gain of ₹2,868 on each lot of 12 shares. A lot that cost ₹13,428 was worth ₹16,296 at the listing price.
The debut was very close to what the grey market had indicated. In the final days before listing, Jio’s unofficial grey market premium stayed between about ₹244 and ₹260, implying a listing price of ₹1,363–1,379. The actual listing at ₹1,358 was slightly below that range, a modest difference of ₹5–21 a share.
The grey market had been unusually stable for an issue this size. It peaked at about ₹273–280 around 20 October, before bidding opened, eased slightly during the subscription period, and then held at around ₹240–260 even as the wider market fell sharply last week. That consistency was a good guide to the actual result.
Record demand
The listing follows record demand for the ₹30,213 crore offer. The IPO was subscribed 22.19 times overall. Qualified institutional buyers bid for 70.55 times their portion, non-institutional investors 14 times and retail investors 2.72 times. Including the anchor book, total demand exceeded ₹7.4 lakh crore from close to 1.39 crore applications, a global record for an IPO.
Because so much of that demand came from institutions, there are likely to be steady buyers after listing. Many funds that received small allocations, or none, will want to build positions in the market. That should support the share price in the early days of trading.
Valuation
At the issue price, Jio Platforms was valued at about $108 billion. At the listing price of ₹1,358, that rises to roughly $130 billion by our calculation, placing it among India’s most valuable listed companies.
For Reliance Industries, which still holds a large majority stake in Jio Platforms, the listing puts a clear market value on one of its two main businesses. Analysts have long argued that Reliance’s share price undervalued Jio because it was unlisted. Separate trading now lets investors value the telecom and digital business on its own.
The gains
The 21% premium is solid for an issue this size, but well below the gains of 60–70% seen on some smaller IPOs this month, such as Tonbo Imaging. That is expected. A ₹30,213 crore issue has a very large number of shares available, and many of the 1.39 crore applicants who received one lot are likely to sell on the first day to lock in gains. A smaller issue with limited shares can move much more on listing day.
Market conditions also played a part. Indian shares have been weak this month, with the Sensex near its lows and smaller stocks down about 9% in October. Brent crude is near $116 a barrel, and the US Federal Reserve announces its rate decision later today. In that environment, a 21% premium is a strong result
A clean, strong listing for India’s largest-ever IPO supports the primary market. It shows investors will pay a premium for large, well-known Indian companies, even as foreign investors take money out of the secondary market. That should encourage the large IPOs expected in the coming months.
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