NEW DELHI: Subscriptions for Indian billionaire Mukesh Ambani's first IPO in two decades surged further on the final day of bidding on Friday, as investors bet on Jio Platforms' US$3.2 billion offering to tap into the nation's telecom and digital sector.
Jio's IPO, India's largest ever, is being closely watched as a test of investor appetite for large listings at a time when AI-linked stocks are facing increased scrutiny. The company, whose mobile network serves more than 500 million users, is launching its IPO during the auspicious Hindu festive season.
Public subscriptions for the IPO crossed 10 times the shares on offer by Friday, driven by strong demand from institutional and retail investors, employees and shareholders. Assuming bids were largely placed at the top end of the 1,119-rupee price band, total demand has now exceeded US$24.5 billion.
That's on top of so-called anchor investors like the Abu Dhabi Investment Authority, BlackRock and Fidelity that bid for their exclusively reserved quota on Monday. Their reserved US$854 million worth of shares received bids of over $25 billion.
"This is a Reliance IPO after a long time, which is triggering a lot of exuberance and euphoria for the stock," said Kranthi Bathini, equity strategist at WealthMills Securities.
The IPO values Jio Platforms at up to US$108.3 billion, potentially making it one of India's biggest companies by market capitalisation when trading starts on Oct 28. It counts Meta Platforms and Alphabet's Google among its investors, and is led by Ambani's eldest son, Akash Ambani.
The IPO got off to an unusually rapid start on Wednesday when the offering was fully subscribed within two hours of opening.
That contrasts with most Indian IPOs, where books typically build gradually and institutional investors often wait until the final hours to place bids.
Jio is part of Ambani's Reliance Industries, a company often seen by Indian investors as a long-term wealth generator. Reliance shares have returned around 900% since 2006, beating the benchmark Nifty index's 685% return, LSEG data shows.
Jio's telecoms business was launched in 2016 and disrupted the market by offering free voice and data, hitting rivals Bharti Airtel and Vodafone Idea. Today, on the basis of customers in a single country, Jio's 500 million-plus users are second only to China Mobile's 600941.SS.
As of Friday, the institutional portion of the IPO was subscribed 26.5 times, underscoring strong demand from large investors. The retail tranche was covered 2.3 times, while bids for the employee and existing Reliance shareholder quotas reached 2.7 and 6.6 times the shares on offer, respectively, exchange data showed.
Reliance was founded by Dhirubhai Ambani, Akash Ambani's grandfather, who cultivated a vast retail investor base through mass shareholder gatherings in Mumbai in the 1980s. On its website, the conglomerate says its 1977 listing helped popularise equity investing in India, "ushering the equity cult" in the country.