The stellar listing of Jio Platforms on October 28, the country’s biggest ever initial public offer (IPO), with an issue size of Rs 30,200 crore, or around $3.2 billion, reflects the growing maturity of the domestic capital markets and will encourage other mega issues from India Inc, top dealmakers told Moneycontrol.
On a day when the BSE Sensex and the Nifty 50 slipped by 352 points and 50 points respectively, Jio Platforms became the second most valuable Indian company by listing on the bourses at a 21.4 per cent premium. It was the best public market debut for a mega issue by a mile, as Life Insurance Corporation of India, Hyundai Motor India and Paytm saw their shares list at a discount while NSE shares listed recently at a 1 per cent premium.
At the end of day’s trade, the share price of Jio Platforms stood at Rs 1,417.35/ share, a 26.7 per cent premium over the issue price of Rs 1,119/share. The firm’s market cap was more than a staggering Rs 13 lakh crore, not far behind parent, Reliance Industries , which had a market cap of Rs 15.67 lakh crore.
So, going ahead, what will be the impact of the successful Jio Platforms IPO on investor appetite for fresh paper in a volatile market environment, hit by rising oil prices and the prolonged Middle East conflict?
“For high-quality companies with scale and profitability, backed by a reputed conglomerate, demand is never a challenge. Jio Platforms IPO shows this. High-quality demand exists regardless of market sentiment. We saw participation from over 1.29 crore applicants and total demand of more than Rs 4.9 lakh crore, reflecting a much larger investor base and the depth of Indian equity markets. The Jio IPO has proved that India has arrived – our markets can now handle such large transactions with ease,” says Atul Mehra, MD & CEO at Axis Capital, part of the book running lead managers for the high-profile deal.