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Reliance Jio In 2020: Users, Valuation, Products, Revenue
It won't be an exaggeration to say that Reliance Jio, the fastest growing telco has witnessed the best times during the pandemic crisis. While it has been tough for several companies across industries to survive during uncertain times, the company run by Mukesh Ambani has seen numerous deals and partnerships with biggies in the tech world such as Google, Facebook, Qualcomm and Intel.
In just a little over three years of its debut, Reliance Jio managed to achieve something that was considered impossible by telecom companies in January 2020. Its achievements are many including the ability to sideline Airtel and Vodafone Idea (now Vi) soon after its launch and the recent announcement of its plans to introduce 5G services in India in the second half of 2021. These are just a fraction of what the company did in 2020.
Now, as we are nearing the end of this year, here we have covered the major aspects that you need to know about Jio's business in 2020. Check out more details regarding one of the fastest-growing companies from here.
Record-Smashing User Base
Reliance Jio is the first telecom operator to surpass the 400 million subscriber base in India. The telco added 3.55 million subscribers only in July 2020, which took its overall user base to 400.8 million. In terms of market share, this accounts to 35.03% of the Indian telecom subscriber base. Following the same, Jio's user base increased to 402.6 million subscribers in August and 404.1 million subscribers in September this year. Also, the telco stood at the third place in September 2020 with 318.28 million active subscribers. We are yet to get the data for the last quarter of this year and we will update once the same is available.
Valuation Set To Rise
The domestic stock markets in the country have been performing quite well over the past few months and experts believe that their record-smashing rally is all set to continue in 2021 too. Before diving deep into the performance of Jio, this itself is a huge feat given the dreaded impact caused by the COVID-19 pandemic on the global economy.
Reliance Industries Limited (RIL)'s shares have grown considerably beating all odds. As per Bloomberg, RIL accounted to one-fifth of the 75% spike in S&P BSE Sensex since March. Notably, this is double the overall contribution of Apple Inc made to gains in the S&P 500 index during the same period.
Notably, Reliance Industries sold a 32.97% stake in its telecom unit and it was followed by its retail business. The company raised huge investment from the fundraise involving companies such as KKR, Mubadala, TPG, General Atlantic, GIC, Facebook, ADIA, PIF, Intel Capital and Silver Lake. This increased its stock market valuation steeply and is expected to continue the same next year too.
Despite the existing challenges, Reliance is selling its stocks for over Rs. 2,000 after a 2.5% increase. So far, Reliance Retail secured $4.4 billion from its investors as mentioned above and TPG will invest Rs. 1,837.5 crore in RRVL (Reliance Retail Ventures Limited), which is a subsidiary of Reliance Industries. With this investment, the pre-money equity value is at Rs. 4.285 lakh crore for which TPG will get 0.41% equity stake in RRVL.
Besides these, Google invested Rs. 33,737 crore and gets 7.7% stake in Jio Platforms. Google is the 13th investor in Jio Platforms in nearly three months. On the whole, until the third quarter ending September 2020, investment in Jio Platforms and Reliance Retail have accounted for over 40% of private equity and VC investments.
Jio Products And Announcements
At the 43rd AGM, Mukesh Ambani made several announcements as detailed below.
Jio Glass: The Jio Glass is one of the latest innovations from the company. It is a mixed reality headset weighing around 75 grams. It is claimed to offer immersive mixed reality services and will be connected by a single cable. The Jio Glass has already has 25 apps that make way for augmented reality video meetings. Notably, this headset can also demo holographic 3D video conferencing, which is one of its top features.
Jio TV+: Reliance Jio TV+ lets users to access 12 OTT platforms. This service will be available only for the JioFiber set-top box users and it comes with a voice search feature too for easier operation.
JioMart - WhatsApp: JioMart has been expanded to additional cities during recent months and it will include electronics too. Also, at the AGM, the company announced the partnership between JioMart and WhatsApp that lets users purchase groceries from nearby stores.
Jio Meet: While the video conferencing and collaboration apps are getting more traction, Jio announced the Jio Meet app. This app can be used for both professional and educational purpose. Being on par with other such video conferencing platforms such as Zoom, Jio Meet provides more flexibility by supporting up to 100 participants.
Besides these, Jio recently announced that it will launch 5G networks in the second half of 2021. Also, it is working on a budget 4G Android smartphone in collaboration with Google. This smartphone is targeted at the 2G users in the country and is likely to be launched in the first quarter of 2021. It is believed to be priced under Rs. 4,000.
Expected Revenue For 2020
Talking about revenue, Reliance Jio reported an ARPU of Rs. 145 per subscriber per month in the second quarter of this fiscal year ending September 2020. This is relatively higher than that of the previous quarter, wherein the ARPU was Rs. 140.3 per subscriber per month. Also, the sales revenue of the company during the same period increased to 7.1, which accounts to $2.9 billion.