Motilal Oswal initiates Jio Platforms with a Buy rating on listing day

what happened

Brokerage Motilal Oswal initiated coverage of Jio Platforms on the day the stock started trading, with a Buy rating and a base case price target of Rs 1,350, about 21% above the Rs 1,119 issue price. Nomura had already started coverage on the same day with a Buy rating and a target of Rs 1,340.

Motilal Oswal expects Jio's revenue to grow at a 14% compound annual rate over fiscal 2026 to 2029, with EBITDA rising 15% a year and profit after tax 20%. In its bull case, it sees revenue growing 16% a year and reported EBITDA 18.5%, with an EV/EBITDA multiple of 13 instead of 11.5 in the base case. The firm also projects cumulative free cash flow of Rs 1.46 lakh crore and a net cash position by fiscal 2029.

The offering is India's largest IPO ever, raising Rs 30,213 crore against record demand of Rs 7.4 lakh crore, including bids from anchor and public investors.

why it matters

Two points matter for markets: the record demand for India's biggest-ever listing, and how Jio should be valued against Bharti Airtel. Motilal Oswal says Jio at the issue price trades roughly in line with its estimate for Bharti Airtel's India business, and could carry a premium in the near term given its market leadership, influence over tariffs and low liquidity. Broker targets reflect one analyst's view rather than a forecast of where the shares will trade.

market impact

Jio and Bharti Airtel shares: Jio's valuation against Airtel sets a reference point for India's telecom sector.

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