CLSA in its latest note on the telecom sector said that Reliance Jio’s rising average revenue per user (ARPU) will be a major driver of growth in both revenue and operating earnings over the next few years. The brokerage estimates Jio’s revenue and EBITDA to climb to $19 billion and $11 billion, respectively, by FY28.
The note highlighted that Jio continues to invest aggressively, with $51 billion in capital employed to date. In CLSA’s sum-of-the-parts (SoTP) valuation for Reliance Industries, Jio is pegged at an enterprise value (EV) of $128 billion, based on 13x EV/EBITDA.
CLSA added that a Jio IPO would be a “mega event” and a significant rerating trigger for Bharti Airtel, given the comparative valuation dynamics. The brokerage reiterated that both Jio and Bharti remain among the most direct ways for investors to participate in India’s ongoing digitalisation.
Disclaimer: This article is based on brokerage views as cited. The views expressed are those of the brokerage and do not represent investment advice.
