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Jio Financial Services created quite the buzz with its debut on India's premier stock exchanges. The shares were introduced at Rs 265 on BSE and a slightly lower Rs 262 on NSE.
Jio Financial’s BSE & NSE listing
This launch price was closely aligned with the previously determined exchange rate of Rs 261.85 per share, recorded on July 20. Interestingly, the listing came around sooner than the anticipated date in September.
A new feather in the Ambani hat
This listing is a notable event, marking the first from the house of Mukesh Ambani in the past twenty years. With a whopping market capitalization hovering around Rs 1.68 lakh crore, Jio Financial Services (JFSL) proudly positions itself as India’s 33rd largest publicly-traded firm. This achievement surpasses other giants such as HDFC Life Insurance, SBI Life, and IndusInd Bank.
When it comes to the Non-Banking Financial Companies (NBFC) spectrum, only the likes of Bajaj Finance and Bajaj Finserv stand taller.
The promise of a digital-first institution
“JFSL aims to embrace the narrative of India and the unique tale of a digital-first institution,” expressed JFSL’s non-executive chairman KV Kamath during the BSE listing ceremony. He highlighted the benefits of entering the market a tad late, stating, “It offers the privilege of leveraging already established technological advancements and maximizing their potential.”
Further, Kamath emphasized JFSL’s goal to emerge as a comprehensive financial sector entity.
The initial market response
Post its listing, there was a flurry of activity. Arbitrage traders, along with RIL investors who received the financial stock as part of the recent demerger and felt uneasy holding it, began capitalizing on their gains. This resulted in JFSL’s shares plunging to the 5% lower circuit limit on both stock exchanges.
Being categorized in the T segment across exchanges, JFSL’s shares have a set upper and lower circuit limit of 5%, applicable for the initial ten days. Market experts opine that the stock might face a selling storm in the near future. This could be attributed to arbitrage traders who secured the RIL stock, eyeing the exclusive chance to obtain one JFSL share for every RIL share they possessed, and are now inclined to realize their gains.
In tandem with these movements, RIL’s shares, which have been on the ex-demerger trajectory since July 20, experienced a 1.5% drop, settling at Rs 2,521.
JFSL’s shareholding structure
The shareholding blueprint of Jio Financial mirrors that of its former guardian, RIL. While the promoters retain a commanding 46%, state-run LIC emerges as a key stakeholder with a 7% share. Other significant investors, each with a 2% stake, comprise the Bank of New York Mellon, SBI MF, Europacific Growth, and the Singaporean government.
Jio Financial Services has embarked on an intriguing journey in India’s stock market. While its debut has been marked by swift highs and lows, the company’s digital-first vision and robust backing promise an exciting future. Only time will tell how this story unfolds and how JFSL carves its niche in the financial sector.