Reliance Jio has announced the Q4 results for FY2019-20 and this is the same period during which the strategic partnership with Facebook was finalised, which sees Jio Platforms Limited get an investment of Rs 43,574 crore by the social media giant Facebook. This $5.7 billion, or Rs 43,574 crore deal, gives Facebook as much as 9.99% stake in Reliance Jio. The company says out of the total investment, Rs 14,976 crore will be retained at Jio Platforms to drive future growth, including the JioMart shopping platform on WhatsApp.
“Jio is embarking on the next leg of growth with a path-defining partnership with one of the world’s largest digital companies, Facebook. We are together determined to make India a truly digital society with best-in-class connectivity network complemented with disruptive digital technology platforms for entertainment, commerce, communication, finance, education and health harnessing world’s best tech capabilities. Our focus will be India’s 60 million micro, small and medium businesses, 120 million farmers, 30 million small merchants and millions of small and medium enterprises in the informal sector,” says Mukesh Ambani, Chairman and Managing Director, Reliance Industries Limited.
Reliance Jio And Facebook Deal Emphasizes Jio as a Catalyst For India’s Digital Shift
This investment by Facebook firmly cements Reliance Jio’s and indeed its subsidiary Jio Platforms credentials as a tech and platform company—in fact, this transaction values Jio Platforms Ltd at post money equity value of Rs 436,172 crore. This is also the biggest minority shareholding deal ever for Facebook or for that matter any tech company, and also the largest foreign direct investment (FDI) for minority stake, in India. It is also the biggest investment in a technology company in India. This puts Jio Platforms among the top 5 listed companies in India by market capitalization, within three and a half years of the launch of commercial services.
Reliance Jio says this investment would enable new opportunities for businesses of all sizes. There is special focus on small businesses across India, and there is expectation that the new digital ecosystems will reach out to as many as 1.3 billion Indians, including via WhatsApp.
Jio Platforms, Reliance Retail Limited and WhatsApp have also entered into a commercial partnership agreement to further accelerate Reliance Retail’s New Commerce business. The JioMart service would be integrated within WhatsApp, which will allow consumers to access the nearest kirana and departmental stores from within WhatsApp, browse what is on sale and order the products from there itself—for home delivery.
The fact is, Jio has been able to make its mark so far by reaching out to pretty much every strata of the society, and not just those who would potentially return higher revenues per user. The Jio mobile data pricing is the biggest example, which has completely changed the way the telecom industry operates.
This partnership comes at a time when technology is in focus, including digital payments.
Disclaimer:News18.com is part of Network18 Media & Investment Limited which is owned by Reliance Industries Limited that also owns Reliance Jio.
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