JIO IPO Review: Finology Deepscan

Hello!

In today’s edition, we analyse the upcoming IPO of Jio Platforms, India’s largest telecom operator by subscribers.

As of June 2026, Jio held a 39.27% share of India’s mobile subscriber market and 43.32% of the fixed broadband market.

Note: This DeepScan is an educational analysis, not a stock recommendation. Its purpose is to help you learn how we analyse businesses. If you’re looking for actionable stock recommendations, explore Finology 30.

Why are we covering the Jio IPO?

When Jio entered India’s telecom market in 2016, around 10 operators were competing for customers. Jio disrupted the market by offering free voice calls and cheap 4G data, forcing competitors to cut prices. The price war that followed made it difficult for smaller operators to survive, leading to several closures and mergers.

A decade later, India’s mobile telecom market is largely controlled by three private companies: Jio, Bharti Airtel and Vodafone Idea.

Among them, Jio is the largest player. Jio and Airtel together account for nearly 77% of India’s mobile subscribers. Jio has also established a strong position in home broadband, with nearly twice as many customers as Airtel.

Metric	Jio	Bharti Airtel
Wireless broadband market share	49.78%	35.47%
Fixed broadband market share	43.32%	22.61%
Fixed broadband customers	2.86 Cr.	1.49 Cr.
Fixed broadband net additions (Q1 FY27)	15 lakh	5 lakh
5G/UBR fixed wireless customers	1.40 Cr.	38 lakh
Mobile subscribers market share	39.27%	37.96%

Jio is India’s largest telecom operator by subscriber base. In FY26, its network carried nearly 60% of India’s wireless data traffic. As of March 2026, Jio held a 49.95% share of the wireless broadband market, compared with 35.13% for Airtel and 12.65% for Vodafone Idea.

Jio customers consumed an average of 42.3 GB of data per month in Q4FY26, compared with 31.4 GB for Airtel and 20.2 GB per 4G/5G subscriber for Vodafone Idea.

This is what makes Jio’s IPO interesting.

Jio’s Business Segments

Broadly, Jio earns money through four businesses.

Business	What it does	Revenue model
Mobile Connectivity	Provides 4G and 5G mobile internet and voice services	Prepaid recharges and postpaid subscriptions
Home Broadband	Provides JioFiber, JioAirFiber, entertainment and smart-home services	Monthly broadband subscriptions and bundled services
Enterprise Services	Provides internet connectivity, cloud, IoT, cybersecurity and communication solutions to businesses	Subscription fees, usage charges and service contracts
Digital Platforms & Technology	Offers JioSaavn, JioAICloud, JioPC, advertising and telecom technology solutions	Subscriptions, advertising, service fees and technology partnerships

Its revenue remains heavily concentrated in connectivity. In FY26, prepaid connectivity services accounted for 77.08% of consolidated revenue.

1. Mobile Connectivity

Mobile connectivity remains Jio’s main business, earning revenue from customers using its 4G and 5G services through prepaid and postpaid plans.

Jio initially focused on gaining market share by offering mobile services at lower prices. This helped it attract a large number of customers, taking its subscriber base to over 50 crore.

Now, with over 50 crore customers, Jio has limited room to maintain its earlier pace of subscriber growth. Future revenue growth will depend more on earning higher revenue from existing customers through tariff increases and upgrades to more expensive plans, both of which increase Average Revenue Per User (ARPU).

Metric	FY24	FY25	FY26	Q1 FY27
Total customer base	48.18 Cr.	48.82 Cr.	52.44 Cr.	53.33 Cr.
Net customer additions	4.25 Cr.	0.64 Cr.	3.62 Cr.	0.89 Cr.
Data consumption/customer/month (Q4)	28.7 GB	33.6 GB	42.3 GB	43.7 GB
Monthly customer churn (Q4)	1.52%	1.81%	1.67%	1.61%

Between FY24 and FY26, Jio’s customer base grew by 8.8%, while monthly ARPU increased by 17.8%, largely due to higher recharge prices.

After years of price competition, Jio, Airtel and Vodafone Idea raised tariffs in 2019, 2021 and again in July 2024. In the latest round, Jio increased prices by around 12-25%, with Airtel and Vodafone Idea introducing similar hikes.

These tariff increases have become easier as competition in the industry has reduced. Jio and Airtel now account for more than 80% of telecom industry revenue, while Vodafone Idea’s financial difficulties have limited its ability to compete on pricing. With fewer competitors, operators have less incentive to cut prices and are better positioned to raise tariffs.

Monthly ARPU (Q4)	FY24	FY25	FY26	Q1 FY27
Jio	₹181.7	₹206.2	₹214	₹215.6
Airtel	₹209	₹245	₹257	₹264
Jio's discount to Airtel	13.10%	15.80%	16.70%	18.30%

Despite operating in the same market and raising tariffs at similar times, Jio still earns less revenue per customer than Airtel. Much of this difference comes from their customer mix.

Jio has historically focused on gaining subscribers through cheaper plans. It continues to target price-sensitive customers through products such as JioBharat, a 4G feature phone priced at ₹799, aimed at users still on 2G networks. While this helps Jio add customers, these users generally have limited capacity to spend more on mobile services.

Airtel, by contrast, has a larger share of higher-paying customers. As of March 2026, it had 2.9 crore postpaid subscribers, while smartphone data users accounted for around 80% of its mobile customer base. Postpaid customers generally spend more on mobile plans, roaming and bundled services, helping Airtel maintain a higher ARPU than Jio.

The difference became clear after the July 2024 tariff hike. Between Q4 FY24 and Q4 FY25, Airtel’s ARPU increased by 17.2%, compared with 13.5% for Jio. Some Jio customers moved to cheaper plans, reducing the benefit of higher prices.

In the three quarters following the hike, Airtel’s subscriber base grew by 2%, while Jio’s fell by 0.3%. Jio later recovered, adding 3.62 crore customers in FY26.

Airtel increased revenue per customer while losing fewer subscribers than Jio after the tariff hike. Jio faces a bigger challenge because more of its customers are price-sensitive. Airtel’s larger premium and postpaid customer base gives it an advantage when raising tariffs.

Another important factor is how much data customers use compared with how much they pay.

Jio’s average monthly data consumption rose from 28.7 GB in Q4 FY24 to 42.3 GB in Q4 FY26, a 47% increase. During the same period, its ARPU increased by only 17.8%. In comparison, Airtel customers consumed 31.4 GB per month in Q4 FY26, even though Airtel earned around 20% more revenue per customer.

The reason is simple. Telecom customers generally pay a fixed amount for their plans. Using more data does not necessarily mean paying more. This is particularly true for unlimited 5G plans, where customers can consume more data without additional charges.

By March 2026, Jio had 26.85 crore 5G customers, accounting for nearly 51% of its subscriber base. As data usage increases, Jio needs to maintain enough network capacity to serve these customers, but higher consumption does not directly increase revenue.

Jio therefore needs tariff increases and customers upgrading to more expensive plans to improve ARPU. Its larger base of price-sensitive customers makes this more challenging than for Airtel, which has a higher share of premium and postpaid customers.

Despite these limitations on ARPU growth, Jio has an important advantage. Much of its network infrastructure is already in place.

Telecom companies spend heavily on spectrum, towers, fibre and equipment before serving customers. Once the network is built, higher tariffs and additional subscribers can increase revenue without costs rising at the same pace, provided network capacity is sufficient.

This is already visible in Jio’s financials. Between FY24 and FY26, consolidated revenue rose 34%, while network operating expenses grew only 14%. As a result, network operating expenses declined from 27.7% to 23.5% of revenue.

For example, if Jio increases its monthly ARPU by ₹10 across its existing 52.44 crore customers, it could generate approximately ₹6,300 Cr. in additional annual revenue, assuming its customer base remains unchanged.

Based on FY26’s incremental EBITDA margin of around 65%, this could add approximately ₹4,100 Cr. to annual EBITDA.

2. Home Broadband

Home broadband has become one of Jio’s fastest-growing businesses. Through JioFiber and JioAirFiber, it provides internet connections to households, along with television channels, OTT subscriptions and other digital services.

Jio entered this market in 2019 with JioFiber, which connects homes through fibre-optic cables. Expanding this business requires investment in laying cables, building local infrastructure and installing equipment at each household.

In densely populated areas, these costs can be spread across more customers, making each connection cheaper. In areas where houses are spread out, the cost per connection is higher, making expansion less profitable.

To address this, Jio launched AirFiber in September 2023. It uses 5G and unlicensed radio technology to provide internet without laying fibre cables to every home. This makes it easier and cheaper to reach customers in areas where traditional fibre connections are expensive.

Jio can also use its existing telecom infrastructure to expand AirFiber. As of June 2026, it had access to over 3.6 lakh towers and 10 lakh route kilometres of fibre, while its wireless network covered more than 99% of India’s population.

The company also holds at least 100 MHz of contiguous mid-band spectrum across all telecom circles, which provides the network capacity needed to offer wireless broadband to households. This reduces the need for Jio to build an entirely new network for its home broadband business.

This advantage is visible in its growing subscriber base.

Metric (June 2026)	Jio	Bharti Airtel
Total broadband customers	2.86 Cr.	1.49 Cr.
Fixed broadband market share	43.32%	22.61%
Fibre broadband customers	1.46 Cr.	1.11 Cr.
5G/UBR wireless broadband customers	1.40 Cr.	38 lakh

Jio has nearly twice as many home broadband customers as Airtel. The difference is much larger in wireless broadband, where Jio has around 3.7 times Airtel’s customer base.

In FY26, Jio added 96 lakh broadband customers, compared with 44 lakh for Airtel, accounting for nearly 68% of all new connections in India. Much of this growth came from AirFiber, which lets Jio reach more households without laying fibre cables to every home.

Jio earns monthly subscription revenue from these customers, but each new connection also comes with equipment and installation costs.

These costs have risen as the customer base grows. In FY26, customer equipment rental expenses rose 106% to ₹3,907 Cr., mainly due to fixed broadband expansion. Content expenses increased 90% to ₹1,735 Cr., partly due to higher broadband subscriptions and entertainment services.

Broadband profitability will depend on how much Jio earns from each customer and how long they stay subscribed. Longer subscriptions help Jio recover the initial equipment and installation costs, improving returns over time.

Jio does not separately disclose broadband revenue, ARPU or profitability, while equipment rental and content expenses are reported at the consolidated level. This makes it difficult to assess the actual returns from broadband expansion.

However, Jio has already built a clear lead in home broadband, particularly through AirFiber. Its existing network allows faster expansion at a potentially lower cost.

3. Enterprise Services

Jio also provides internet connectivity and digital services to businesses, banks, manufacturers and government organisations. These include dedicated internet connections, cloud storage, cybersecurity and communication services.

Large businesses often need several services to manage their daily operations. Jio can offer these services together under a single contract, allowing it to earn more from each customer. Its major offerings include enterprise connectivity, cloud computing, JioThings for connected devices and JioCX for customer communication through SMS, WhatsApp and email.

Jio already serves several large organisations. As of June 2026, it had provided at least one service to more than 90% of India’s public- and private-sector banks. Its connectivity solutions were also used in around 45% of connected electric two-wheelers in India.

For example, JioThings provides connected-vehicle services to companies such as Ola Electric, Ather Energy and JSW MG Motor. These services help manufacturers track vehicle locations, monitor performance and provide digital features to customers.

As businesses use more cloud services and connected devices, Jio has opportunities to sell additional services to its existing customers. Enterprise contracts can also provide recurring revenue, while services integrated into daily operations may be difficult for customers to replace.

Jio does not separately disclose enterprise revenue, contract values or profitability. While its relationships with large organisations provide opportunities for growth, it is difficult to assess how much this business currently contributes to Jio’s earnings.

4. Digital Platforms and Technology

Jio is also developing digital services for its mobile and broadband customers. These include JioSaavn for music, JioTV+ for entertainment, JioAICloud for storage, JioPC for cloud-based computing and JioAds for digital advertising.

Jio can use its existing customer base to promote these services. In FY26, the MyJio app had 21.59 crore average monthly active users. Through this app and its mobile and broadband plans, Jio can reach a large number of customers without spending heavily on acquiring new users.

For example, JioAICloud, launched in 2024, had around 6.6 crore registered users by June 2026. JioPC, launched in 2025, allows customers to access computing services through a television connected to Jio’s set-top box.

Jio can earn revenue from subscriptions, advertising and partnerships with other digital service providers. The challenge is converting users into paying customers, as many of these services are either free or bundled with existing plans.

Jio has also developed technology for 5G networks, network management and fixed wireless broadband. It plans to offer some of these solutions to telecom operators in other countries, which could provide another revenue stream.

Jio’s financial contribution from its digital and technology businesses remains difficult to assess because the company does not separately disclose revenue and profitability.

For now, telecom connectivity remains Jio’s main earnings driver, with home broadband becoming an important growth driver. Digital services, enterprise solutions, and telecom technology could add revenue over time, but their contribution to profitability remains unproven.

Business Economics and Financials

Between FY24 and FY26, Jio’s consolidated revenue increased from ₹1,09,558 Cr. to ₹1,46,885 Cr., growing at a CAGR of 15.8%. Net profit grew faster at 18.4%, reaching ₹30,049 Cr.

Telecom is a business where companies spend heavily upfront on building networks. Once the infrastructure is in place, additional customers and tariff increases can generate more revenue without a similar increase in operating costs, as long as the network has enough capacity.

This is visible in Jio’s financials. Between FY24 and FY26, revenue rose 34%, while network operating expenses grew only 14%. As a result, these expenses declined from 27.7% to 23.5% of revenue, helping EBITDA margin improve from 50.2% to 51.9%.

Despite this improvement, Airtel India continues to earn higher operating margins.

FY26	Jio	Airtel India
Revenue	₹1,46,885 Cr.	₹1,40,373 Cr.
EBITDA	₹76,255 Cr.	₹82,193 Cr.
EBITDA margin	51.90%	58.60%
EBITDA less capex	₹42,071 Cr.	₹51,186 Cr.

Despite earning slightly lower revenue, Airtel India generated around ₹5,900 Cr. more EBITDA. Its higher ARPU and larger premium customer base help it earn more from each customer, supporting better operating margins.

Jio has seen a bigger improvement in cash generation as spending on its 5G network has declined.

During the initial 5G rollout, Jio’s annual cash capex reached ₹53,510 Cr. in FY24. With most of the initial rollout completed, capex fell to ₹34,184 Cr. in FY26.

As a result, EBITDA remaining after capex increased from just ₹1,449 Cr. in FY24 to ₹42,071 Cr. in FY26. In FY24, almost all of Jio’s operating earnings were being spent on network expansion. By FY26, around 55% of EBITDA remained after capex.

FY26 cash flow	Amount
Operating cash flow	₹77,556 Cr.
Less: Cash capex	₹34,184 Cr.
Less: Deferred spectrum payments	₹4,736 Cr.
Less: Lease payments	₹6,064 Cr.
Less: Finance costs paid	₹12,241 Cr.
Cash remaining	₹20,331 Cr.

Another important consideration is Jio’s spectrum liabilities.

As of June 2026 (Q1FY27), Jio owed approximately ₹1.05 lakh Cr. to the government for spectrum purchased in earlier auctions. These payments are spread over several years and carry interest, making them similar to debt.

Jio’s reported net debt declined from ₹27,579 Cr. in March 2026 to ₹9,539 Cr. in June 2026. This brings net debt to around 0.12x trailing 12-month EBITDA. However, this figure excludes deferred spectrum payments. Including them increases net debt to approximately ₹1.14 lakh Cr., or 1.44x EBITDA, even before considering lease liabilities.

Airtel India currently generates more EBITDA and retains more earnings after capex, despite having similar revenue. For Jio, further cash-generation improvement will depend on increasing ARPU.

Future Growth Opportunities

1. Higher Revenue from Existing Mobile Customers

With 53.33 Cr. customers, Jio has limited room to maintain its earlier pace of subscriber growth. Increasing revenue from existing customers will therefore become more important.

As of June 2026, around 53% of Jio’s customers were using 5G. In Q1 FY27, average monthly data consumption increased by 18% YoY to 43.7 GB per customer, while ARPU grew by only 3.3% to ₹215.6. Since most customers pay a fixed amount for their plans, higher data usage does not directly increase Jio’s revenue. It can also require additional network investment as consumption increases.

Jio will therefore depend more on tariff increases and customers moving to higher-priced plans. India’s mobile broadband ARPU is expected to grow by around 10% annually through FY31.

2. Home Broadband Could Become a Major Growth Driver

Fixed broadband offers Jio a large opportunity to add new customers. Only 21% of Indian households had fixed broadband connections in FY26, which is expected to increase to 46% by FY31, taking the industry’s customer base from 6.61 Cr. to 15.04 Cr.

Jio already leads the market with 2.86 Cr. customers and a 43% market share. Its customer base has more than doubled since March 2024, largely driven by JioAirFiber, which now has 1.4 Cr. customers. AirFiber allows Jio to provide broadband without laying fibre cables to every home, making it easier to expand into smaller towns and rural areas.

Jio captured nearly 62% of new broadband connections in Q1 FY27. Even if it maintains its current 43% market share, its customer base could reach around 6.5 Cr. by FY31. Industry revenue is also expected to grow from ₹35,000 Cr. to ₹93,000 Cr. during this period, supported by more connections and higher customer spending.

3. Enterprise Connectivity and Cloud Services

Jio is also expanding into business connectivity, cloud computing and other enterprise services. India has over 7.9 Cr. MSMEs, but fewer than 40 lakh businesses had fixed broadband connections in FY26. This number is expected to reach 3.2 Cr. by FY31, while the business connectivity market could grow from around ₹50,000 Cr. to ₹91,000 Cr.

Jio can use its existing network and JioAirFiber to reach these businesses and sell additional services such as cloud storage, cybersecurity and managed Wi-Fi. It already provides services to over 90% of India’s public and private sector banks and has connected more than 75% of operational airports. These relationships make it easier to sell more services to existing customers.

Cloud computing is another opportunity, with India’s enterprise cloud market expected to grow from ₹36,800 Cr. in FY26 to ₹1,02,900 Cr. by FY31. However, Jio will have to compete with established players such as AWS, Microsoft and Google. Its existing network and customer relationships could help it enter the market, but its ability to compete profitably is yet to be proven.

Key Risks In the Business

1. High Capital Requirements and Pressure on Profit Growth

Jio still needs to spend heavily on its network, even after completing most of its 5G rollout. Its capital spending declined from ₹53,510 Cr. in FY24 to ₹34,184 Cr. in FY26, but it still accounted for 23.3% of revenue.

As customers use more internet, Jio needs to invest in additional network capacity to maintain speed and service quality. However, customers on fixed-price plans do not pay extra simply because they consume more data. This means Jio may have to keep spending more on its network without earning proportionately more revenue.

These investments are also pressuring profits. In Q1 FY27, depreciation rose 15.1% YoY and finance costs rose 41.6%, partly due to 5G network costs. As a result, while EBITDA grew by 15.1%, PAT increased by only 9.2%.

If Jio cannot increase ARPU fast enough to cover rising network costs, its profit growth and cash generation could remain under pressure.

2. Limited Earnings Contribution from Non-Telecom Businesses

Jio Platforms has expanded into cloud computing, AI, entertainment and enterprise services, but its earnings remain heavily dependent on telecom. In FY26, its core subsidiary, Reliance Jio Infocomm (RJIL), accounted for 87.7% of consolidated revenue, 94.9% of EBITDA and 93.8% of PAT.

Jio has launched several digital products, including JioAICloud, JioPC and JioBrain, but their financial contribution remains unclear. JioAICloud had 6.6 Cr. registered users as of June 2026, although the company does not disclose how many are paying customers or how much revenue the platform generates. Jio has also not yet started earning revenue from selling its telecom technology internationally.

Until these businesses demonstrate meaningful profitability, Jio’s earnings will remain largely dependent on its telecom operations. This also makes it difficult to justify assigning additional valuation to its digital and technology businesses.

3. Dependence on Reliance Group and Third-Party Infrastructure

Jio depends heavily on Reliance Group companies for distribution and other important services. Reliance Retail is the sole distributor of Jio’s prepaid services, which accounted for 77.1% of consolidated revenue in FY26. It handles recharges, customer acquisition, KYC and payment collection, for which Jio paid around ₹4,355 Cr. in FY26.

Jio also depends on a few infrastructure providers. As of June 2026, Summit Digitel owned around 48% of the 3.61 lakh towers Jio used, while Jio Digital Fibre provided nearly 98% of its fibre network requirements, excluding RJIL’s own last-mile fibre. This creates long-term payment obligations and dependence on other companies for essential network infrastructure.

With RIL holding 66.43% of Jio Platforms before the IPO, related-party transactions remain a concern. Any increase in distribution fees, infrastructure charges or royalties could reduce Jio’s profitability and affect minority shareholders.

Coming to Valuations..

Jio’s IPO price band of ₹1,065-1,119 per share values the company at approximately ₹9.8-10.3 lakh Cr. Based on its trailing 12-month PAT of ₹30,703 Cr., Jio is valued at 32-34x earnings, compared with around 37x for Bharti Airtel. This puts Jio at an 8-14% discount to Airtel.

Airtel has an advantage in the quality of its customer base. In Q1 FY27, its monthly ARPU stood at ₹264, around 22% higher than Jio’s ₹215.6. Airtel also has around 3 Cr. postpaid customers, who account for just 8% of its subscribers but contribute approximately 12% of wireless revenue.

This difference was visible after the July 2024 tariff hikes. Between Q4 FY24 and Q4 FY25, Airtel’s ARPU increased by around 17%, compared with 14% for Jio. Jio also lost more subscribers in the months following the hikes, as some customers moved to cheaper plans or left the network.

Tariff increases will remain an important source of growth for both companies. Airtel has already raised its postpaid tariffs by ₹50 in October 2026. Even if both operators increase ARPU by 15%, the gap between them would widen from ₹48 to approximately ₹56 per month. Jio will need to attract more higher-paying customers to reduce this difference.

In our view

Jio is India’s largest telecom operator by subscribers and also leads in home broadband. With over 53 Cr. customers, future growth will depend more on tariff increases and earning more from existing users. Home broadband offers another opportunity as more households get internet connections. Airtel, meanwhile, earns more from each customer and retains more operating earnings after network spending.

Disclaimer

Investment in securities market are subject to market risks. Read all the related documents carefully before investing. The information and analysis provided herein are for educational and informational purposes only and do not constitute investment advice, a research recommendation, or an offer, solicitation, or recommendation to buy, sell, or hold any security. Investors should exercise their own judgment, conduct independent due diligence, and consult professional advisers before making investment decisions. Finology Ventures Private Limited, its affiliates, directors, employees, and research analysts shall not be liable for any loss or damage arising from the use of or reliance on this information.