Brokerage Motilal Oswal has initiated coverage on Jio Platforms with a 'Buy' rating and a Rs 1,350 price target. The report highlights potential growth in broadband and wireless services ahead of the company's market debut today.
Motilal Oswal Financial Services has officially started tracking Jio Platforms, issuing a 'Buy' rating with a target price of Rs 1,350 per share. This report comes just ahead of the company's scheduled stock market debut. The brokerage’s outlook is based on expectations of sustained growth in India’s wireless and broadband segments, projecting a 21 percent upside from the IPO issue price of Rs 1,119.
The core of the bullish case is the company’s strong hold on the wireless sector, where it currently captures over 42 percent of industry revenue. The brokerage anticipates this share will increase to 43.3 percent by the end of the decade. A significant part of the revenue growth plan relies on a projected 15 percent tariff hike expected in March 2027. Additionally, home broadband is viewed as a major growth driver, with the brokerage estimating that Jio will secure nearly three-quarters of all new broadband subscribers in the country over the next three years, aiming to grow its own base to 5 crore users.
Financially, the report projects a 14 percent annual growth rate in consolidated revenue through the 2029 financial year, with net profits expected to grow by 20 percent annually. The analysis suggests that the company is transitioning toward a net cash position by 2029, aided by the recent Rs 30,188-crore capital infusion from its initial public offering and moderating capital spending. The brokerage values the company at 11.5 times its estimated operating profit for the 2029 financial year, which implies a valuation premium compared to peers like Bharti Airtel. This premium is partly attributed to the company’s influence on local pricing and a limited free float of shares.
However, the report also outlines several risks that investors should track. The primary concern is regulatory uncertainty; if the expected tariff hikes are delayed, the company’s revenue growth could be lower than forecasted. There is also an execution risk related to enterprise digital services, where adoption has been slower than anticipated. Furthermore, if the company’s capital intensity increases unexpectedly, it could weigh on future cash flows. Aggressive competition remains a persistent feature of the Indian telecom sector, which could also influence the stock’s performance in the near term. The final outcome for shareholders will depend heavily on the actual pace of tariff revisions, the successful scale-up of the broadband business, and the company's ability to manage its capital spending effectively.