Jio Financial Services Listing BSE, NSE: Shares of Mukesh Ambani’s Jio Financial Services or JFSL will list on stock exchanges BSE and NSE on Monday.
Jio Financial Services, earlier known as Reliance Strategic Ventures will be listing today and at current levels, the stock is valued at Rs 1.66 lakh crore, making it the second largest NBFC in the country after Bajaj Finance. A special one-hour price discovery session valued the demerged entity at Rs 261.85, well ahead of street expectations, which were pegged anywhere between Rs 120 – Rs 150 per share.
Ahead of the listing, the shares of the digital-first NBFC were trading at around Rs 300 apiece in the grey market, higher than the pre-listing price of Rs 261.85.
While veteran banker KV Kamath will be the non-executive chairman at Jio Financial Services, Isha Ambani has been appointed as a non-executive director on the board of JFS. Hitesh Sethia, a former ICICI executive, will take on the role of the new CEO and MD.
Also, Charanjit Singh Attra, who recently resigned as Chief Financial Officer of the State Bank of India (SBI), has taken up the position of Chief Operating Officer at Jio Financial Services.
Trade-to-Trade Segment
In this segment, shares can be traded only for compulsory delivery basis. Intraday trades are not possible.
If an investor buys shares of JFS and tries to sell it on the same day, or before the shares are credited to the demat account, then the order will be rejected. The stock will be in this segment for 10 days.
Tax Calculation
Before the demerger, the company apportioned 95.32 percent as RIL’s cost of acquisition and 4.68 percent for Jio Financial Services. This will help investors calculate their capital gains tax at the time of sale of shares.
This means an investor who bought RIL shares on July 19, a day before the demerger, is deemed to have paid Rs 133 (or, 4.68 percent of Rs 2,853 closing price) for Jio Financial Services.
What Analysts Say?
Sriram Velayudhan of IIFL Securities told CNBC-TV18 on July 19 that he is valuing Jio Financial Services between Rs 205 – Rs 210 per share. This was before the price discovery session. He further said that there will be decent unlocking of value in Jio Financial Services. He assigned a 20 percent holding company discount to Reliance Industries’ investment in Jio Financial Services.
While some analysts are optimistic due to the strong demand for financial services in India and the company’s robust parentage, others are more cautious. “Their reservations stem from the fact that Jio Financial is still in its nascent stages and hasn’t yet achieved profitability,” said Sonam Srivastava, Founder and Fund Manager at Wright Research.
She suggests that RIL shareholders who have acquired Jio Financial shares due to the demerger should consider retaining them for an extended period. “Jio Financial boasts a promising business model and is poised to leverage the escalating demand for financial services in India. However, potential investors should be aware that the stock might be somewhat illiquid at present, which could lead to short-term volatility,” the fund manager said.
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