Jio Financial’s discovered price exceeds estimates
NEW DELHI : The stock price of Jio Financial Services Ltd was discovered at ₹261.85 apiece at a special pre-opening session conducted on Thursday, exceeding analysts’ estimates of ₹125-250. The National Stock Exchange scheduled the special pre-open session between 9 and 10 am to determine the price for Jio Financial in the capital market segment. The move followed Reliance Industries Ltd’s (RIL) decision to spin off its financial services business, Reliance Strategic Investments Ltd, and change its name to Jio Financial Services.
The price discovery process was based on the difference between the closing price of RIL shares, which was at ₹2,580 at the end of the pre-opening session, and Wednesday’s closing price of ₹2,841.85. Consequently, Jio Financial Services was included in various indices, including the Nifty, at a price of ₹261.85. This price will remain constant till the date of the company’s listing is declared.
RIL shareholders are being issued Jio Financial Services shares at a ratio of 1:1, meaning shareholders will get one equity share of Jio Financial for each held in RIL on the record date. According to V.K. Vijayakumar, chief investment strategist at Geojit Financial Services, the market-discovered price of Jio Financial Services was much higher than most brokerage estimates.
“This price reflects the market’s assessment of the company’s potential," he said. The wide reach of Jio Financial Services through RIL’s other business segments like Reliance Retail has the potential to grow the company quickly for many years to come, and the market is discounting this potential, he added. The group’s significant presence in the retail and telecom sectors not only drives its customer base but also fosters vendor
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