Jio Financial shares in Reliance were valued at Rs 261.85 each.

Jio Financial shares in Reliance were valued at Rs 261.85 each.

New DELHI: Very rich person Mukesh Ambani’s new chocolate boy Jio Monetary Administrations (JFSL) nowadays took all bulls of Dependence Businesses (RIL) by astonish as the NBFC unit’s share cost came out to be Rs 261.85 per share, much higher than þrokerage gauges of up to Rs 190.

At the conclusion of a uncommon pre-open call sell off session on stock trades on Thursday, the advertise cost of Jio Money related Administrations (JFSL) was inferred at Rs 26185 per share on NSE. Taking under consideration the affect of demerger, the share cost of Dependence Businesses (RIL) fell to Rs 2,580 but energized up to 2% after ordinary exchanging resumed from 10 am.

Reliance Strategic Investments Limited, which is becoming JFSL, has a post-demerger acquisition cost of 4.68%, according to a statement made by RIL earlier in the day. The cost of acquisition equals Rs. 133 when Wednesday’s BSE closing price of Rs. 2,840 is taken into account.

The exercise to value JFSL today exceeded all brokerage predictions, which put the share price at between Rs 160 and 190 per unit.

“The market’s evaluation of Jio Financials’ potential is reflected in this high price. For many years to come, JFSL could experience rapid growth thanks to the broad reach it has through RIL’s other business units, such as Reliance Retail. The market is undervaluing this possibility, according to Geojit Financial’s Dr. V K Vijayakumar.

Following the demerger, JFSL will have 635.32 billion outstanding shares, making the company’s entire market capitalization Rs 1.66 lakh crore.

How was the share price of JFSL determined?

Today from 9 am to 9:45 am, the BSE and NSE stock exchanges had a special pre-open trading session during which the market price of the demerged business was determined. Regular trading in the Nifty50 shares was banned till 10 am as part of the exercise.

The difference between RIL’s closing price on Wednesday and the price determined during the special pre-open session today is what is used to calculate JFSL’s constant price today. RIL’s last trading session on the NSE finished at Rs 2,841.85, while its current price following the special session is Rs 2,580. The price of JFSL is calculated as the difference between RIL shares before and after the demerger, or Rs 261.85.

At the close of business on July 19, all RIL shareholders will be entitled to receive JFSL shares in a 1:1 ratio. You will receive 100 JESL shares, for instance, if you own 100 RIL shares. However, until JFSL shares are listed on stock exchanges, you cannot trade them.

The upcoming AGM of Reliance is scheduled to disclose the listing date, which might occur in the following two to three months.

Nifty’s reaction to RIL’s demerger

The benchmark Nifty50 index will contain JFSL at the constant price determined today.
“JFSL shall be removed from the NSE and BSE indices at the close of the JFSL listing date plus three business days, as determined by the last trading price. For example, if JFSL purportedly lists on August 21, 2023, shares will be forcibly destroyed on August 24, 2023, according to Nuvama’s Abhilash Pagaria.

Why did they demerge?

Because the growth and expansion of the financial services industry would necessitate a differentiated strategy matched to its industry-specific risks, market dynamics, and growth trajectory, the Ambani family made the decision to spin-off JFSL into a separate corporation.
The type and level of competition in the financial services industry are different from those in other RIL-owned industries from oil to chemicals, retail, and telecommunications.
Additionally, compared to RIL, the demerger will provide JESI access to greater leverage for expansion. It is viewed as a value-unlocking process for shareholders.