Reliance Jio is scaling up its 5G-based fixed wireless access (FWA) business, Jio AirFiber, with plans to significantly increase customer additions over the coming year. This move is part of a broader strategy to drive 5G monetization ahead of a potential initial public offering (IPO) by late 2025. Jio aims to onboard one million AirFiber customers within 30 days, leveraging subscriber growth and rising data consumption to enhance its valuation ahead of the IPO.
Brokerage firm CLSA highlighted that these efforts could significantly boost Jio’s market value. The company has expanded its distribution network and streamlined its onboarding process, enabling it to connect over one million homes monthly. As of September 2024, Jio had 2.8 million AirFiber users and is estimated to have added 1.9 million more broadband customers in the December quarter.
AirFiber’s High Revenue Potential
Jio AirFiber offers much higher revenue potential compared to mobile services. Its average revenue per user (ARPU) stands at ₹650–700 per month, over three times Jio’s ₹195 mobile ARPU as of Q2FY25. This positions AirFiber as a key driver of 5G monetization, especially as Jio continues to recover its $25 billion investment in 5G infrastructure.
To accelerate 5G monetization, Jio raised the minimum plan threshold for its 5G mobile broadband service in July 2024, prompting users to upgrade to higher-value plans. Analysts believe that expanding AirFiber’s high-ARPU user base will further boost monetization efforts, particularly as the impact of recent mobile tariff hikes is expected to manifest fully by Q4FY25 and Q1FY26.
ARPU Growth and Financial Outlook
Faster monetization of 5G services is projected to drive Jio’s ARPU growth, strengthening its financial profile ahead of its anticipated IPO. CLSA forecasts Jio’s operating income (EBITDA) to grow 40% to ₹87,600 crore by FY27, with ARPU expected to reach ₹230 by the same period.
Potential for India’s Largest IPO
Sanford C. Bernstein has valued Jio Platforms Ltd. (JPL), encompassing Reliance’s telecom and digital businesses, at $98 billion. This positions Jio’s IPO as potentially the largest in India’s history, potentially raising ₹42,100 crore. Current regulations mandate companies with valuations exceeding ₹1 trillion to sell at least a 5% stake in their IPO.
The largest IPO in India to date was Hyundai India’s ₹27,856 crore offering in 2023. Reliance Industries, led by Mukesh Ambani, holds a 66.5% stake in JPL, while the remaining 33.5% is owned by strategic investors such as Meta, Google, and global private equity firms. JPL had raised ₹1.52 trillion from these investors in 2020.
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Bernstein predicts Jio will achieve a compound annual revenue growth rate of 17% over the next three years, driven by 14% ARPU growth in FY26. By then, Jio is expected to capture 48% of the telecom industry’s revenue, solidifying its leadership position.
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