Reliance Jio's current debt at over Rs 49,000 crore
Reliance Jio's current debt is Rs 49,000 crore added to the spectrum liability, according to a Bloomberg report. It further added that Jio has deferred the spectrum payment liability of Rs 21,000 crore to the government.
Reliance Jio had recently spend Rs 13,672 crore in the latest spectrum auctions. It's parent company Reliance Industries Ltd (RIL) has also announced plans to fund another Rs 30,000 crore Reliance Jio.
To strengthen Jio’s balance sheet for growth, the Board of Directors of RIL has decided to make a rights issue of 6 billion aggregating up to Rs 30,000 crore. This would be 9% Non Cumulative Optionally Convertible Preference Shares (‘OCPS’) at a face value of 10 each for cash at a premium of Rs 40 per OCPS.
RIL has been infusing a lot of investment into its telecom arm since its was launched in September 2016. The reason for the current debt is that it has been offering Jio to customers for free in order to attract customers to its services. While it offered Jio services free of cost for the first three months with its 'Welcome Offer', it further extended its free services till March 31 with its 'Happy New Year' offer.
Since its launch on September 05, 2016, Jio has managed to cross 50 million subscribers in just 83 days, adding at an average rate of 6 lakh 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, stated RIL.
As of December 2016, there were 72.4 million subscribers on the Jio network.