Industry Odisha Bureau, Oct 21: After strong backing from global institutions, lenders are courting retail buyers with loans and texts. Grey-market hopes run high, though analysts remain split over valuation.
Non-bank lenders and brokerages have shifted into marketing overdrive for the Jio IPO. Their target is the retail buyer in potentially India’s largest IPO.
The Reliance Industries unit is raising ₹30,213 crore. On Monday, it placed ₹8,110 crore with anchor investors. Anchors include Life Insurance Corporation of India, BlackRock, Fidelity, Capital Group and Allianz. Sovereign funds from Abu Dhabi, Singapore, Qatar and Norway also joined. Such global backing lifts confidence but does not prove fair pricing.
The ₹10,500-crore retail portion runs from October 21 to 23. Syndicate bankers see strong retail demand as vital for a healthy debut.
SBI Securities and Jio Financial Services are advertising short-term loans through apps and texts. Platforms were also asked to target dormant trading accounts, a source told Mint. HDFC Securities texted one inactive client urging reactivation, but cited no loans. Axis Direct banners urged investors to activate accounts.
Bloomberg reported on October 16 that Reliance paid salaries 15 days early. It also reportedly asked most of its 420,000 group employees to participate. Neither company responded to Mint’s emails by press time.
Terms reviewed by Mint show lenders funding 60% to 90% of application value. Loans run 15 to 90 days, with allotted shares held as collateral. Unlike ordinary margin trading, this credit funds bids before shares list. Borrowing more raises bid size, not allotment certainty. Interest falls due regardless, and a weak debut would magnify losses.
Such financing is established practice, but targeted credit campaigns are rare. Neither SEBI, the markets regulator, nor the Reserve Bank bars such offers, Mint reports. Alay Razvi, managing partner at Accord Juris, flagged “direct marketing of leverage around one issuer”.
The Nifty 50 is down more than 10% this year. InvestorGain data show a ₹243 grey-market premium, about 22% above the ₹1,119 upper price. These unofficial quotes are hopes, not listing guarantees.
Hyundai Motor India’s $3.3 billion 2024 issue was subscribed 2.37 times. Retail buyers took only about half their portion. The shares closed their October 22 debut about 7% below issue price.
Jio leads Indian telecom by subscribers, outpaces rivals on revenue growth and is expanding broadband. Yet its average revenue per user still trails Bharti Airtel’s. Its return on capital employed has also fallen.
Brokers compare enterprise value (EV) with EBITDA, or earnings before interest, tax, depreciation and amortisation. Emkay Global values Jio at 15.6 times FY26 EV/EBITDA and backs subscribing. Centrum Broking values Jio’s equity at ₹11.5 trillion, using 12 times estimated FY28 EBITDA. Bharti Airtel trades at 8.59 times estimated FY28 EBITDA, per Bloomberg data. Its African and Indus Towers businesses, and differing base years, limit direct comparisons.
Loans and grey-market buzz can fill an order book. They cannot settle whether the price is fair. Returns will rest on earnings and valuation, not subscription momentum.
