Jio Platforms IPO Oversubscribed 5.57 Times on Day Two, QIBs Lead Demand

Jio Platforms has recorded an impressive performance in its initial public offering (IPO), which concluded its second day of bidding on Thursday with a subscription rate of 5.57 times the shares offered. This strong demand highlights continued investor confidence as the issue approaches its closing date.

Qualified Institutional Buyers (QIBs) led the surge, submitting bids for 13.29 times their allocated shares, a significant jump from 9.42 times on the first day. Retail investors showed a more modest increase, with subscriptions rising to 1.54 times from 0.73 times, while Non-Institutional Investors (NIIs) also posted strong interest at 5.97 times, up from 1.68 times on day one.

Among the various categories, existing shareholders placed bids for 4.04 times their reserved shares, and employees subscribed at 2.10 times, both showing notable growth compared to the previous day. However, retail investors remained the least subscribed segment despite their increased activity.

Breaking down the QIB bids, Foreign Institutional Investors (FIIs) accounted for 222.9 million shares, domestic financial institutions including banks and insurance companies bid for 344.1 million shares, and mutual funds contributed 42.3 million shares. The total QIB bid volume reached 651.5 million shares, significantly outstripping the 49 million shares allocated to this group.

Within the NII category, larger investors placing bids above ₹10 lakh showed higher enthusiasm with a subscription rate of 6.76 times, compared to 4.38 times for those bidding between ₹2 lakh and ₹10 lakh. Prakarsh Gagdani, founder of Soaring Peaks Capital, noted that retail demand appeared subdued partly because many retail investors are existing Reliance Industries Limited (RIL) shareholders who may be bidding under the shareholder quota. Additionally, retail investors generally face a ₹2 lakh cap per bid, but many have exceeded this limit in Jio's IPO.

Gagdani emphasized the strong institutional interest, particularly from asset management companies and other large investors, describing the nearly fourfold subscription from the shareholder category as significant. He dismissed concerns about diminishing demand, stating, "It’s significant; in no way the demand for the IPO is reducing." Sandeep Gupta, director at Valmiki Leela Capital, highlighted that the issue is priced for quality with a valuation multiple of approximately 33 times estimated earnings for the fiscal year 2025-26 and about 2.8 times book value, suggesting that retail investors might be restrained due to tempered expectations for immediate listing gains.

Jio Platforms' IPO became one of the fastest fully subscribed offerings in Indian market history, reaching full subscription within 100 minutes of opening on Wednesday morning. By the end of day one, the issue had already achieved a subscription rate of 3.16 times. This rapid pace was enabled by a special exception granted to Jio and the National Stock Exchange (NSE) due to the large size of the offering.

The robust QIB demand is notable as these investors typically do not bid so aggressively in the initial days of an IPO. For comparison, the NSE’s recent IPO had a first-day QIB subscription of just 0.19 times, which only surged to 12.68 times on the final day.

On the secondary market, RIL shares closed down 2.03 percent at ₹1,184.50, near the upper end of Jio Platforms’ price band of ₹1,119. Some market participants believe investing in RIL stock presents a broader exposure to Jio’s growth prospects, alongside Reliance Retail, oil and chemical businesses, and new energy ventures. Several brokerages and investors view both Jio Platforms and RIL as having strong long-term potential with opportunities for value unlocking following the IPO listing.

Looking ahead to the final day of bidding, experts expect another wave of QIB and large NII participation, with retail and shareholder subscriptions likely to increase as the issue closes. Gagdani predicted the IPO would close with a healthy subscription level, though without excessive frenzy, reflecting disciplined pricing. Gupta pointed out that the substantial equity base and market capitalization near ₹10.3 trillion mean much of the positive sentiment is already factored into the price. He advised that investors focus on post-listing fundamentals such as interest savings from debt prepayment, stabilization of return on capital employed (ROCE) after its recent decline, and prudent capital expenditure management.

For those holding shares long-term, the IPO listing day will mark just the beginning of their investment journey in Jio Platforms.