Jio Financial Services (JFS) Makes Grand Debut as Second-Largest Listed NBFC
As Jio Financial Services debuts on the market today, its market capitalization surpasses that of prominent Nifty 50 companies such as UPL, Hero MotoCorp, and Apollo Hospitals. Furthermore, it has exceeded the market capitalization of IndusInd Bank, which stands at ₹1.06 lakh crore.
Jio Financial Services (JFS) marked its remarkable entry into the stock market on August 21, emerging as the second-largest listed Non-Banking Financial Company (NBFC) after Bajaj Finance. With an impressive market capitalization of ₹1.66 lakh crore, JFS has established itself as a significant player in the financial landscape.
As of the closing price on August 18, Bajaj Finance boasted a substantial market cap of ₹4.15 lakh crore. Although Bajaj Finserv holds a market cap of ₹2.32 lakh crore, it functions more as a financial services holding company rather than a conventional NBFC.
Market experts anticipated that JFS's market capitalization during its listing would surpass the implied value of ₹1.65 lakh crore. This anticipation stemmed from the fact that the shares were trading at a premium of ₹50 in the grey market. If the stock had debuted at ₹300 per share, its market cap would have scaled up to ₹1.9 lakh crore.
Interestingly, Jio Financial Services' current market cap still eclipses Nifty 50 giants such as UPL, Hero MotoCorp, Apollo Hospitals, IndusInd Bank, Britannia, and Tech Mahindra. Impressive feats indeed.
Foreign broking firm Jefferies valued JFS's net worth at ₹28,000 crore. This valuation accounts for the 6.1 percent stake in Reliance Industries, a result of transferring treasury shares from the parent company. Excluding the cost of this stake, the company's core net worth likely hovers around ₹14,000 crore.
Now, industry insiders eagerly await insights into JFS's business model. While a 50:50 joint venture with Blackstone to enter the asset management sector has been announced, JFS's lending strategy remains shrouded in mystery. Most analysts speculate that the company will set its sights on the merchant loan space, leveraging Reliance Industries' extensive presence in kirana stores.
Guided by the expertise of non-executive chairman KV Kamath and CEO/MD Hitesh Sethia, both seasoned figures in the banking sector, RIL's Chairman Mukesh Ambani is confident that JFS will be instrumental in reshaping India's digital financial landscape.
Mukesh Ambani affirmed, "Jio Financial Services Limited and its subsidiaries will harness Reliance's technological capabilities to deliver financial services digitally, democratizing access to financial offerings for Indian citizens." Ambani's vision emphasizes simplicity, affordability, and innovative digital-first solutions.
Investors eagerly anticipate a deeper dive into JFS's intricacies during the conglomerate's upcoming annual general meeting scheduled for August 28.
What's Your Reaction?
