Jio Financial shares edge higher ahead of Q2 results

Shares of Jio Financial Services (JFS), the demerged entity of Reliance Industries, remain in focus today as the company is slated to release its first-ever quarterly results since listing. The non-banking financial corporation (NBFC) arm of RIL has failed to get good response from investors so far, with shares delivering muted return of 5% since listing on the BSE and the NSE on August 21 after spending a month as a dummy stock on the exchanges since July 20, following the demerger from the parent.

Ahead of September quarter results, Jio Financial shares opened marginally higher at ₹225 against the previous closing price of ₹224.25 on the BSE. In the first hour of trade so far, the NBFC major gained as much as 0.75% to ₹225.95, while the market capitalisation rose to ₹1.43 lakh crore. The company is the third largest NBFC after Bajaj Finance and its holding company Bajaj Finserv in terms of market capitalisation.

The counter hit an all-time high of ₹278.20 on August 21, 2023, while it touched its record low of ₹205.15 on August 25, 2023.

For the quarter ended June 30, 2023, JFS (formerly known as Reliance Strategic Investments Limited) recorded a net profit after tax at ₹145.7 crore against a loss of ₹1.84 crore in the year ago period. The company had posted a profit of ₹31.25 crore in the March 2023 quarter.

The total income from operations stood at ₹214.57 crore in the June quarter compared with ₹44.84 crore in the March 2023 quarter and loss of ₹14.03 crore in the corresponding period last year.

JFS, a part of billionaire Mukesh Ambani-led conglomerate, was demerged from the parent on July 20, 2023. The RIL’s board appointed Hitesh Kumar Sethi as managing director and chief executive officer of the company, as well as Isha Mukesh Ambani and Reliance executive Anshuman Thakur as non-executive directors. Besides, former Union Home Secretary Rajiv Mehrishi, former MD and CEO of Punjab National Bank Sunil Mehta, and Bimal Manu Tanna, a chartered accountant who worked with PwC, have been appointed as independent directors on the board for a term of five consecutive years up to July 6, 2028.

Reliance Industries chairman Mukesh Ambani at the 46th annual general meeting announced that JFSL will foray into the insurance segment. “JFS will enter the insurance segment to offer simple, yet smart, Life, General, and Health insurance products through a seamless digital interface, potentially partnering with global players. It will use predictive data analytics to co-create contextual products with partners and cater to customer requirements in a truly unique way,” he said at RIL’s AGM on August 28, 2023.

Besides, JFS has partnered with the U.S. investment major BlackRock India to enter the asset management industry in the country. It has formed a 50:50 joint venture (JV), Jio BlackRock, to forey into the Indian asset management market with JFS and BlackRock targeting an initial investment of $150 million each in the JV.  The joint venture, which will have its own management team, will launch operations post-receipt of regulatory and statutory approvals. 

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