Reliance Jio to Launch 4G Services in 400 Cities by March 2015

Amidst all the speculation about the future of 4G services in India, Reliance Jio is finally showing signs of its seriousness towards launching these services across 400 cities by March next year.

This year marks the completion of 1/5th of the total license period for Reliance Jio and 4 years have passed without the generation of any revenue.This put Chairman and Managing Director of Reliance Industries Limited (RIL), Mukesh Ambani under the scanner by the media and public alike.

Reliance Jio Back in Action

With the laying of the Optical Fiber Cable (OFC) being sped up, and a wide variety of equipment being imported and ready to be installed, the services are likely to see the light of day very soon. Sources say that the project is being led directly by Mukesh Ambani. There is a sudden change of vibe among company officials within Reliance Jio. The Delhi and Gurgaon offices have become an energetic hub of activity.

The cost to deploy 4G networks across India is estimated to run into ₹70,000 Crores. Global bank, UBS, recently valued Reliance Jio at ₹140 per share while adjusting for net debt of the business. Representatives also remarked that any sale of stake could drive up the valuations of the company.

As per a document submitted to bankers, Reliance Jio intends to roll out services in some of the leading urban cities and address rural area coverage as well. This plan takes into account the company’s ongoing endeavor in setting up 1,70,000-km long OFCs across the country.

A spokesperson from the company says, “While we believe that the revenues of the Indian telecom sector will continue to grow with the economy, its composition will shift from the predominant share of voice and text services as is the case today, to broadband and digital services in the years to come. Reliance Jio is well-positioned to capture a significant share of this revenue migration as well as of the additional value creation on account of broadband services.”

The success of this endeavor is important since the low broadband penetration in India makes end users more eager for 4G services.

RIL Increases Stake in Reliance Jio

Just ahead of its launch of 4G services, RIL has increased its stake in Reliance Jio to 98.9%. In March this year, it put in more capital into this business. The increased stake was bought over from the Nahatas, promoters of Infotel Broadband, since they did not make any additional investments after the 2010 rollout of services. Infotel Broadband was previously sold to RIL right after it won a pan-India broadband license in the year 2010. It is believed that the Nahatas will continue to have a seat on the board of Reliance Jio. Currently, they own 0.13% of stake in Reliance Jio. Additionally, Infotel Infocom owns 0.55% of the stake; NextwaveComm owns 0.17% of the company, while 0.25% belongs to other investors.

//

Advertisements

Tags: , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: