Reliance Industries announces Rs 30,000 crore rights issue

Mumbai, Jan 16 (IANS) Reliance Industries on Monday announced a rights issue of optionally convertible debentures to the tune of Rs 30,000 crore to further fund its Jio 4G telecom services business that now has a subscriber base of 72.5 million.

“In view of the unprecedented customer response to Jio’s services as well as to address the anticipated growth in demand for digital services, additional investments are proposed to be made into the network to enhance its coverage and capacity,” the company said.

“These investments are proposed to be financed largely through an equity offering, to strengthen Jio’s balance sheet for growth,” it added.

“Accordingly, the board of directors of the company has decided to make a rights issue of six billion, 9 per cent non-cumulative optionally convertible preference shares of Rs 10 each for cash, at a premium of 40 per cent aggregating to Rs 30,000 crore.”

The company said Jio has continued to expand its network, both in terms of coverage as well as capacity and will soon reach out to cover over 90 per cent of the population shortly. It said the Jio speed test results suggest an average download of 18.17 Mbps — twice that of any other operator.

Yet, it added: “Jio continues to face interconnection congestion issues with some of the large operators on account of inadequate provision of points of interconnection capacities even months after commencement of services by Jio.”

On subscriber base, the company said since its commencement of services on September 5 2016, Jio has become the fastest-growing technology company in the world and crossed the 50-million mark in just 83 days, adding at an average rate of 600,000 subscribers per day.

“This subscriber addition rate is the fastest achieved by any company in the world including the likes of Facebook, WhatsApp and Skype. Jio continues its rapid ramp up of subscriber base and as of December 31, 2016, in less than four months from commencement of services, there were 72.4 million subscribers on the network,” it said.