A tweet from Reliance Jio also hints to that, as the table summerizes all fund received into Jio. (table below)
Just like NASA's Jet Propulsion Laboratory (JPL) made rockets, India's JPL or simply Jio has shown its growth like a rocket. It began from a scratch and developed as a greenfield pure 4G operator, backed by several app based ecosystem.
Look West for Funds - After Facebook's investment, Jio got investment from several PE firm and investment companies from America - Silver Lake, Vista Equity, General Atlantic, KKR ＆ Co, TPG and L Catterton. In total 7 American companies have invested in Jio.
In February 2020, US President D. Trump came to India, and in an interaction with industrialists RIL chairman Mukesh Ambani told that Jio is the only operator in the world, which do not use a single Chinese component. Trump is found happy, "That's good. Good. Put a bid in." as US is trying India and other allies to boycott Huawei, the telecom equipment major of China. I guess American companies find Jio a safe investment, by technologically, and also geo-politically.
Jio also received investment from middle east; Mubadala Investment Fund and Abu Dhabi Investment Fund (ADIF) - both are from Abu Dhabi, UAE.
The last investment came from The Public Investment Fund (PIF), the sovereign wealth fund of Saudi Arabia. The amount is Rs 11,367 Cr, which translates into 2.32% equity share in Jio Platforms on a fully diluted basis.
Founded in 1971, PIF is one of the largest sovereign wealth funds in the world with total estimated assets of nearly $400 billion.
Based on this investment, Jio Platforms is valued at an equity value of Rs 4.91 lakh crore, and an enterprise value of Rs 5.16 lakh crore.
Fund inflow into Jio:
Date
|
Company
|
Investment
|
Stake
acquired
|
|
1
|
April
21 ‘20
|
Facebook
(US)
|
Rs
43, 574 Cr
|
9.9%
|
2
|
May
4
|
SilverLake
(US)
|
Rs
5,655.75 Cr
|
1.15%
|
3
|
May
8
|
Vista
Equity (US)
|
Rs
11,367 Cr
|
2.32%
|
4
|
May
17
|
General
Atlantic Partners (US)
|
Rs
6598.38 Cr
|
1.34%
|
5
|
May
22
|
KKR
＆ Co. (US)
|
Rs
11,367 Cr
|
2.32%
|
6
|
June
4
|
Mubadala
Investment Co
|
Rs
9,093.60 Cr
|
1.85%
|
7
|
June
7
|
Abu
Dhabi Investment Fund (ADIF)
|
Rs
5683.50 Cr
|
1.16%
|
8
|
June
5
|
SilverLake
(US)
|
Rs
4,546.80 Cr
|
0.93%
|
9
|
June
13
|
TPG
(US)
|
Rs
4,546.80 Cr
|
0.93%
|
10
|
June
13
|
L
Catterton (US)
|
Rs1,894.50
Cr
|
0.39%
|
11
|
June
18
|
Public
Investment Fund (Saudi Arabia)
|
Rs
11,367 Cr
|
2.32%
|
Total
|
Rs
1,15,693.95 Cr
|
24.70%
|
||
May
20 to June 3rd
|
RIL
Rights Issue
|
Rs
53,124.20 Cr
|
||
Grand
Total of Investments raised in 58 days
|
Rs
1,68,818.15 Cr
|
|||
BofA Securities predicts that Jio would be valued at USD 110 billion in FY22 from its present value of $ 66 billion. It should be noted that Airtel stands at a value of $ 40 billion. BofA considers the fact that Jio will have 53% rise in ARPU from present Rs 131 to Rs 200 in FY22; and upcoming IPO of Jio. They also considers that Jio will get good business on fiber broadband and enterprise segment and Jio's app ecosystem will be a good garner.
Data from Reuters Eikon study shows, Reliance Industries is now the 60th in the list of most valued firm in the world (in end of 2019 it was at 73th). The top 5 firms are Saudi Arabian Oil Co, Apple, Microsoft, Amazon, Alphabet.
As of 25th June, 2020 Competition Commission of India (CCI) has approved Facebook Inc.’s acquisition of a 9.99% stake in Jio Platforms Ltd.
During lockdown period, we saw investments from American companies to Jio in vast amount. The reason is they find Jio a safe company in many terms. Jio's 4G vendor is South Korean company Samsung, not any Chinese vendor. Also Jio has huge customer base in India, and is rightly directed towards digital goals.
As we are going through COVID-19 pandemic, many investors are not feeling safe to do business with Chinese companies. Many companies already have started to move out from China, and shift their work base to Vietnam or Taiwan or Bangladesh. India is yet to be that good book to be.
Interestingly on June 25th State Secretary of United States of America, Mike Pompeo tweeted, Jio as ''Clean Telcos'', as 'they are rejecting doing business with tools of the CCP surveillance state, like Huawei.' The statement proves Jio is a winner in the geopolitical game, and it firmly believes that investments in Jio are in safe hands.
Self developed 5G by Jio?
Self developed 5G is not a right phrase to write, as it is not AI driven. But what Jio plans, it's desi 5G from the house of Reliance.
Well 5G is the next step of technology upgrade, and we, sitting in India already have multiple, if not several smartphones supporting 5G new radio signals. So even the tech is nowhere in the sight, the device ecosystem is being ready. The major issues to get 5G is the spectrum and its pricing. Unless government don't vacate/allow the new radio signals (3.5 or 6GHz) for 5G, it is not coming. However as 5G will travel via higher frequencies, it is obvious that network coverage would be poor unless telcos put a gamut of money to create the 5G network with modest to superior coverage.
As per ET report, Jio has developed fully automated cloud-native end-to-end 5G technology and will ask for DoT approval to start 5G trial in their campus.
Reliance has two tech companies as subsidiaries - Rancore Technologies as telecom software developer since the inception of Jio (then Infotel), and RIL acquired US based Radisys in June 2018. Both are targeted to same vertical i.e. development of telecom software, equipments & gear along with in-house research and development.
Jio has also filed applications with the DoT to conduct trials with European vendors – Ericsson and Nokia, and its existing partner Samsung.
Avoiding Chinese telecom vendors (Huawei and ZTE) is getting traction after US President tags these companies as an extension of Chinese military's surveillance system. As per latest report 5G license winners in Singapore, SingTel and StarHub-M1 JV will deploy 5G using Ericsson and Nokia's 5G solutions respectively.
In another event, China Unicom partners with Nokia for networking products for 5G - approximately 10% share of China Unicom’s 5G core network.
Army & State backed Vietnamese telco Viettel to bring native 5G
Viettel, the telecom major of Vietnam has planned to launch 5G services in June 2020 based on its own equipment and software. However I guess they would miss the deadline due to COVID outbreak, but that's not important. The important part is Vietnam's government owned and part of Army communications, Viettel plans to make their home grown 5G standards.
Vietnam's ambition is multifactorial, as they have issues with China mostly on territorial claims in the South China Sea. Huawei may be cheap as 5G vendor, Vietnam can't take risk associated with Huawei. It may face public outrage, and leak of information to China. Another thing is Vietnam is getting traction from worldwide industries, due to availablity of cheap labor.
Viettel has presence in other Asian, South American and African countries. Despite that Viettel is a smaller company compared to global telecom giants like Ericsson, Nokia or Samsung. In a general thought, Viettel may control the core software part in their 5G program, while equipment may be made by vendors as requested.
Jio and Viettel has similar aim but with different viewpoint. Jio wants to cut down costs by home grown tech following self-reliance strategy, and it will play by volume to generate revenues. Jio has deep pockets too to push desi 5G to ultimate level.
As of 25th June, 2020 Competition Commission of India (CCI) has approved Facebook Inc.’s acquisition of a 9.99% stake in Jio Platforms Ltd.
During lockdown period, we saw investments from American companies to Jio in vast amount. The reason is they find Jio a safe company in many terms. Jio's 4G vendor is South Korean company Samsung, not any Chinese vendor. Also Jio has huge customer base in India, and is rightly directed towards digital goals.
As we are going through COVID-19 pandemic, many investors are not feeling safe to do business with Chinese companies. Many companies already have started to move out from China, and shift their work base to Vietnam or Taiwan or Bangladesh. India is yet to be that good book to be.
Interestingly on June 25th State Secretary of United States of America, Mike Pompeo tweeted, Jio as ''Clean Telcos'', as 'they are rejecting doing business with tools of the CCP surveillance state, like Huawei.' The statement proves Jio is a winner in the geopolitical game, and it firmly believes that investments in Jio are in safe hands.
Self developed 5G by Jio?
Self developed 5G is not a right phrase to write, as it is not AI driven. But what Jio plans, it's desi 5G from the house of Reliance.
Well 5G is the next step of technology upgrade, and we, sitting in India already have multiple, if not several smartphones supporting 5G new radio signals. So even the tech is nowhere in the sight, the device ecosystem is being ready. The major issues to get 5G is the spectrum and its pricing. Unless government don't vacate/allow the new radio signals (3.5 or 6GHz) for 5G, it is not coming. However as 5G will travel via higher frequencies, it is obvious that network coverage would be poor unless telcos put a gamut of money to create the 5G network with modest to superior coverage.
As per ET report, Jio has developed fully automated cloud-native end-to-end 5G technology and will ask for DoT approval to start 5G trial in their campus.
Reliance has two tech companies as subsidiaries - Rancore Technologies as telecom software developer since the inception of Jio (then Infotel), and RIL acquired US based Radisys in June 2018. Both are targeted to same vertical i.e. development of telecom software, equipments & gear along with in-house research and development.
Jio has also filed applications with the DoT to conduct trials with European vendors – Ericsson and Nokia, and its existing partner Samsung.
Avoiding Chinese telecom vendors (Huawei and ZTE) is getting traction after US President tags these companies as an extension of Chinese military's surveillance system. As per latest report 5G license winners in Singapore, SingTel and StarHub-M1 JV will deploy 5G using Ericsson and Nokia's 5G solutions respectively.
In another event, China Unicom partners with Nokia for networking products for 5G - approximately 10% share of China Unicom’s 5G core network.
Army & State backed Vietnamese telco Viettel to bring native 5G
Vietnam's ambition is multifactorial, as they have issues with China mostly on territorial claims in the South China Sea. Huawei may be cheap as 5G vendor, Vietnam can't take risk associated with Huawei. It may face public outrage, and leak of information to China. Another thing is Vietnam is getting traction from worldwide industries, due to availablity of cheap labor.
Viettel has presence in other Asian, South American and African countries. Despite that Viettel is a smaller company compared to global telecom giants like Ericsson, Nokia or Samsung. In a general thought, Viettel may control the core software part in their 5G program, while equipment may be made by vendors as requested.
Jio and Viettel has similar aim but with different viewpoint. Jio wants to cut down costs by home grown tech following self-reliance strategy, and it will play by volume to generate revenues. Jio has deep pockets too to push desi 5G to ultimate level.
No comments:
Post a Comment