Here's what Jio was worth before the Facebook deal valued it at over $65 billion

Since its launch in late 2016, the company has become India's top telecom operator amassing a user base of 370 million through a barrage of innovations, including offering cut-throat mobile internet prices and a diverse suite of products and including chat services, movies, games and music.

In its bid to make the telecom company net-debt free by 2020, RIL in October 2019 set up Jio Platforms to house all its digital assets including Jio. The new wholly-owned subsidiary absorbed RIL's equity investment of Rs 65,000 crore in Jio.

While the move did not alter RIL’s consolidated debt position, it helped deleverage the digital platforms and telecom services business, priming it for a potential stake sale.

"Given the reach and scale of our digital ecosystem, we have received strong interest from potential strategic partners," Chairman Mukesh Ambani had said at the announcement of Jio Platform. "We will induct the right partners in our Platform Company, creating and unlocking meaningful value for RIL shareholders."

Also Read: Reliance Jio-Facebook: Mukesh Ambani’s RIL one step closer to zero-debt plan

Following the announcement in October 2019, global brokerage house Jefferies assigned an enterprise value of $65 billion-$70 billion to Jio Platforms, the most valued in the world in terms of EV/Ebitda after Amazon, according to a report in Fortune India.

The report in November pegged RIL’s EV/Ebitda at 22.6 (assuming a valuation of $65 billion-$70 billion). At the time, Amazon enjoyed an EV/Ebitda of 23.4, much higher than other tech giants such as Alibaba at 22.1, Alphabet (15.5), Tencent (19.6), Facebook (13.9), and Apple (17.5).

"The reorganisation will increase standalone liabilities but Reliance hopes that will be able to monetise its stake in the platform's business at premium valuations. An EV of $65-70 billion for the platforms entity will imply a hefty estimate of 1.75 times the net invested capital, in our estimate," analysts at Jefferies had said.

Meanwhile, CLSA assigned a sum-of-the-parts enterprise value of $45 billion to Jio at that time.

"In most valuations used by the Street, including ours, Jio is valued mainly as a telecom service provider with no value ascribed for Jio’s suite of apps, digital investments and capabilities like AI, IoT etc. This exercise aims to correct that positioning. Indeed, some of Jio's apps like TV, music and cinema are among the best in their respective categories," the CLSA report stated.

In March, analysts at Bernstein had valued Jio more than $60 billion citing that the company will lead India's transition from 2G to 4G with the advent of JioPhone.

Disclaimer: Reliance Industries Ltd., which also owns Jio, is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.