Home / Companies / News /  Reliance Jio Infocomm raises $750 million

Mumbai: Reliance Jio Infocomm Ltd (R-Jio) on Wednesday said it has raised $750 million (around 4,815 crore) from a consortium of nine banks to finance goods and services procured from Samsung Electronics Co. Ltd and Ace Technologies Corp., two of its main vendors.

The loan, which was raised on 7 May, was guaranteed by export credit agency Korea Trade Insurance Corp. (K-Sure) and is the second such facility to the telecom subsidiary of Reliance Industries Ltd (RIL). A part of the loan was also guaranteed by RIL, R-Jio said in a note.

“It has a door-to-door tenor of 12 years, including a two-year availability period and 10-year repayment period thereafter. The facility is funded by nine relationship banks of Reliance (RIL)," said the note.

The consortium includes Hongkong and Shanghai Banking Corp. Ltd (HSBC), Australia and New Zealand Banking Group Ltd, Banco Santander SA, Bank of Tokyo-Mitsubishi UFJ Ltd, JPMorgan Chase Bank NA, Mizuho Bank Ltd, Sumitomo Mitsui Banking Corp., ING Bank and DZ Bank AG.

R-Jio has a pan-India unified licence to provide high-speed 4G voice and data services across 22 telecommunication circles under the 2300 megahertz (MHz) band of spectrum. It also has spectrum in the 800MHz and 1800MHz bands in 20 of India’s 22 telecom circles.

The company is setting up a country-wide telecom network set to provide high-speed Internet connectivity, communication services and various other digital services in areas such as education, healthcare, security, financial services, government-citizen interfaces and entertainment.

The company has so far invested over $14 billion to set up the telecom infrastructure, but has not announced any date for the roll-out of its services. In April, Mint had reported that the company is likely to launch voice-based services in at least five cities by June-end. In an analyst meet on 17 April, the company had said that RIL chairman Mukesh Ambani will talk about its roll-out during its annual general meeting expected to be held in mid-June.

The company, analysts say, is expected to make heavy losses in its initial years of operations due to the heavy capital expenditure (capex) in the absence of any roadmap to win market share from established players. The current capex of $14 billion is close to the money spent by India’s largest telecom company Bharti Airtel Ltd over its 23 years of existence.

“We expect R-Jio’s loss at 53-54 billion in the first two years of operation (fiscal year 16-17)," said a December note released by Bank of America Merrill Lynch.

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Recommended For You

Edit Profile
Get alerts on WhatsApp
Set Preferences My ReadsWatchlistFeedbackRedeem a Gift CardLogout