Jefferies sees Reliance Jio poised for strong growth; forecasts 18% revenue CAGR, USD 180 billion valuation by FY27

New Delhi [India], November 7 (ANI): Reliance Jio is well-positioned to deliver strong growth over the next few years, supported by rising telecom tariffs and rapid expansion in its home broadband segment, particularly through Fixed Wireless Access (FWA), according to a report by Jefferies.
The report stated that Jio is expected to post 18 per cent and 21 per cent compound annual growth rate (CAGR) in revenues and EBITDA respectively over FY26-28.
It stated "Reliance Jio remains well-placed to deliver 18 per cent/21 per cent CAGR in revenues/EBITDA over FY26-28, given rising tariffs in mobile and sharp growth in home broadband business led by FWA. Growth is likely to remain strong, led by scale-up of the enterprise business and monetisation of tech stack".
Reflecting its optimism on Jio's growth prospects, the brokerage firm raised its target EV/EBITDA multiple to 15x, which represents a 10 per cent premium to Bharti Airtel, citing a superior growth outlook.
EV/EBITDA is a valuation metric that compares a company's Enterprise Value (EV) to its Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
The report also rolled forward its valuation to December 2026 and increased its enterprise value (EV) estimate for Jio to USD 180 billion.
According to the report, Jio's broad technology ecosystem spanning radios, network core, OSS/BSS systems, and FWA solutions provides it with a strong competitive edge.
With global 5G penetration still relatively low, Jio's cost-efficient solutions can help it scale in the USD 121 billion global telecom technology market, offering another avenue for growth.
Over the past two years, Jio Platforms has significantly ramped up its technology investments, as reflected in a 13-fold jump in patent filings and a 4-fold increase in patent grants.
The company has also enhanced its contributions toward shaping future global connectivity standards, increasing its participation in 3GPP standards for 5G and 6G by nearly 7 times to 70.
Jio is also developing artificial intelligence-based solutions aimed at optimising network operations and is actively working toward accelerating the adoption of Open Digital Architecture.
The Jefferies report highlighted that the global network infrastructure market remains concentrated, with the top five players controlling around 80 per cent market share. These companies traditionally offer bundled hardware and software solutions that simplify network management but are often costly.
With the rollout of 5G and the adoption of open architectures, the separation of hardware and software layers allows software players to capture a larger portion of the market value.
Given the low 5G penetration globally, especially in low-income markets, Jio's 5G technology stack which is already tested at scale with over 200 million subscribers, presents a cost-effective and scalable alternative.
This, Jefferies said, can drive an additional layer of growth for Reliance Jio in the coming years. (ANI)