Mukesh Ambani’s Jio Financial Services (JFS) is seeking shareholder approval to acquire telecom equipment and devices worth ₹36,000 crore from the retail arm Reliance Retail Ltd.
Ambani’s expansion plan
Under the proposed deal, the JFS unit called Jio Leasing Services will buy telecom equipment and devices which usually include routers and cell phones. The equipment is supposed to be deployed in broadband wireless connectivity and other services.
Jio Leasing Services will rent out the equipment it buys to customers of Reliance Jio Infocomm, the financial services company further said. JLSL will provide devices and telecom equipment on operating lease to the customers of Reliance Jio Infocomm Ltd.
“JLSL is entering into the business of operating lease via a Device-as-a-Service (DaaS) model. DaaS is a new-age service model where businesses or individuals lease certain goods along with associated services, rather than purchasing the devices outright,” according to a postal ballot notice to shareholders by JFS.
Jio Leasing Services is set to compete in the device-rental market with Hewlett-Packard and Lenovo.
Voting on proposed items in the notice ends on June 22. The deal is expected to go through in the financial years 2025 and 2026.
In the quarter ended March 2024 (Q4FY24), Jio Financial Services Ltd reported a consolidated net profit increase of 5.8% year-on-year to Rs 311 crore, up from Rs 294 crore in the same quarter of FY23.
The total income of the company rose to Rs 418 crore in Q4FY24 from Rs 414 crore in Q4FY23. These were the first annual results of the company as a listed entity.
