Jio Financial’s promise of the future

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₹1.55 trillion, making it the third-most valuable in its space. In the financial services space, this value is less about what it has done so far and more about what it promises. Those two different prisms partly explain the volatility the stock has seen since its listing.

Reliance Industries first announced the demerger of Jio Financial Services from itself in late-2022. This July, it spun off the financial services businesses under the Jio brand—used in telecom and media—into a separate company. Ultimately, six other Reliance subsidiaries were housed in a company, Reliance Strategic Investments, which was renamed to Jio Financial Services (JFS).

As of 31 March, JFS had assets of ₹1.15 trillion and was registered with the Reserve Bank of India as a non-banking finance company (NBFC). A large part of this asset base was from shares held by it of subsidiaries, associate companies and joint ventures. In 2022-23, JFS’ consolidated revenues amounted to ₹1,635 crore, a fraction of leading NBFCs.

Yet, it is already ranked third in terms of market cap, stemming from its other Reliance holdings and the promise in financial services. While it is unclear as to which businesses in the financial service space JFS will eventually get into, the subsidiaries it houses are startups in sectors as diverse as payment aggregation, retail finance and insurance broking. It also has a tie-up to enter the fund management business with BlackRock, the world’s largest asset manager, and news reports say the group is likely to enter the insurance business too.