Reliance Jio Might Re-Establish Itself In Consumer Technology Market: Report

Reliance Jio's deal with Silver Lake, a US private equity firm, is expected to help Reliance Industries re-establish itself in the consumer technology market as its petrochemical and refining segments are not doing well. However, some analysts believe that the company will recover its losses in the refining and petrochemical businesses.

"Core energy business could be staring at a multi-year slump, but "repositioning as a consumer/technology company" should continue to support the stock price," brokerage firm JP Morgan was quoted by Economic Times as saying.

The report states that the crude price has dropped. But still, Jio's partnership with Facebook for JioMart is likely to increase its valuation in the market. "The deal is part of RIL's plan to strengthen its businesses and to achieve a net cash position. -through partnerships and supported by organic growth and low capex," Nitin Soni, senior director, Corporate Ratings at Fitch Ratings said.

Silver Lake Plans To Invest Rs, 5,656 Crore In Reliance Jio Platforms

After selling its 9.99 percent stake to Facebook, Reliance Jio has announced that Silver Lake is all set to invest Rs 5,655.75 crore into its platform, which will give it a value of 4.90 lakh crore in the market. However, the deal needs to go through the regulatory approvals.

"Jio Platforms is one of the world's most remarkable companies, led by an incredibly strong and entrepreneurial management team who are driving and actualizing a courageous vision... The market potential they are addressing is enormous," Egon Durban, Silver Lake Co-CEO, and Managing Partner said after announcing the deal with Reliance Jio.

The deal or the announcement comes two weeks after Facebook announced its deal with Jio platforms, where the former is investing Rs. 43,574 crore for buying the minority stake. It is worth mentioning that Silver Lake has invested in several companies, including Alibaba, Twitter, Dell Technologies, Airbnb, and more.

For the unaware, Mukesh Ambani has invested 40 billion in Reliance Jio. So, this deal is expected to reduce the Reliance Industries debt, which has increased in the expansion of Jio platforms. Furthermore, the firm wants to become a debt-free company as soon as possible that's why it is selling its stake to other companies.