Reliance Jio to invest on its network to improve coverage

Posted on January 16, 2017

Within a few months of its launch, Reliance Jio has grown perhaps like no other telecom industry in India. It provides free and unlimited broadband (4G) to all its users till the end of March, this year. This offer is what has attracted millions of Indian customers to avail its services. It is now giving the, already established broadband and telecom providers in India like Airtel, Vodafone, Aircel etcetera, a run for their money. Reliance Jio Info-com is now planning to invest Rs. 30,000 crores to expand its network coverage and increase its network capacity. The total investment made by the company so far, on its network, is more than Rs. 1.9 lakh crores! Read more on Investments

“In view of the unprecedented customer response to RJIL’s services as well as to address the anticipated growth in demand for digital services, additional investments are proposed to be made into the network to enhance its coverage and capacity”, Reliance Jio mentioned in a rights issue notice for their existing shareholders today. These investments will be financed through an equity offering to keep its balance sheet stronger, it added. “The company wishes to inform that board of directors at its meeting held on January 13, 2017, has decided to make a rights issue of 6 billion, pertaining to 9% non-cumulative optionally convertible preference shares of Rs 10 each for cash, a premium of Rs 40 per OCPS, aggregating to Rs. 30,000 crores”, Reliance Jio’s notice stated. The Company is offering free and unlimited local and STD calls for a lifetime, even while roaming, apart from its free and unlimited 4G broadband service till March, this year.

Considering all these offers and investments, it is no wonder that Reliance Jio is giving its competitors, even established ones, a run for their money. If Reliance Jio manages to give continued flawless and quality service to its customers, its competitors will be out of the picture soon. The investments to improve its network coverage and its network capacity will definitely give it an edge over its competitors and improve its sales and revenue. Its competitors will have to upgrade their network infrastructure, capacity, coverage and efficiency by similar amounts to stay relevant in this industry. Indian citizens love to receive stuff for free. Reliance Jio has definitely used this fact well to its advantage. We will have to wait and see if it is able to capitalize on its advantage and gain so far. Read more on Startup News