Jio Financial Services listing: Share allotment, expected share price, board members details here
The RIL board has also approved the appointment of Hitesh Sethia as the CEO and MD of RSIL for 3 years. Isha Ambani has been appointed as a non-executive director of the new entity
- Jul 8, 2023,
- Updated Jul 8, 2023 5:54 PM IST
Jio Financial demerger: Reliance Industries Limited’s financial services business, Reliance Strategic Investments (RSIL), will soon be demerged from its parent company. On Saturday, RIL announced the record date for the demerger Reliance Strategic Investments, which will be renamed Jio Financial Services (JFSL).
The date was announced after National Company Law Tribunal on July 6 approved the scheme of arrangement. Following that, RIL said in a regulatory listing that it will now take the necessary steps for the demerger and subsequent listing of RSIL.
On Friday, the decision was taken at a board meeting of the company.
Record date
On Saturday, the oil-to-telecom services conglomerate said that the record date for determining the equity shareholders who are entitled to receive shares of Reliance Strategic Investments has been fixed to July 20.
Share allotment
As per the scheme, Reliance Strategic Investments will allot one fully paid-up equity share of RSIL of the face value of Rs 10 each, for every one share of Reliance Industries as of the record date.
"In accordance with the terms of the Scheme, Thursday, July 20, 2023 has been fixed as the Record Date for the purpose of determining the equity shareholders of the Company entitled to receive the Resulting Company New Equity Shares," RIL said in a regulatory filing, adding that the effective date of the demerger scheme is July 1.
Board members
The RIL board has also approved the appointment of McLaren Strategic Ventures' Hitesh Sethia as the CEO and MD of RSIL for 3 years.
Besides, former union home secretary Rajiv Mehrishi and PNB's former MD and CEO Sunil Mehta would also join the company as independent directors.
Isha Ambani, Mukesh Ambani's daughter, has also been appointed as a non-executive director of the new entity, which is subject to approval from the Reserve Bank of India (RBI).
Expected share prices
Global brokerage firm JPMorgan has estimated Jio Financial's share price at Rs 189, Centrum Broking has set a range of Rs 157-190. Jefferies has estimated that Jio Financial Services' share price would be around Rs 179 apiece.
Jio Financial Services’s market value
Jio Financial Services is expected to compete with the likes of Paytm and Bajaj Finance in the financing segment.
The company is estimated to have an underlying net worth of about Rs 1,50,000 crore, of which there are about Rs 1,10,000 crore worth of shares of Reliance Industries. The balance is in the form of the real net worth.
The financial services undertaking has investments in 6 companies - Reliance Industrial Investments and Holdings (RIIHL), Reliance Payment Solutions, Jio Payments Bank, Reliance Retail Finance, Jio Information Aggregator Services and Reliance Retail Insurance Broking.
After the demerger, JFSL will acquire liquid assets to provide adequate regulatory capital for lending to consumers, merchants, etc., and incubate other financial services verticals such as insurance, payments, digital broking, and asset management for at least the next 3 years of business operations.
Also read: Jefferies says Indian stock market not too expensive as earnings growth catches up
Also read: Reliance Retail opts for reduction of share capital at Rs 1,362 per share
Jio Financial demerger: Reliance Industries Limited’s financial services business, Reliance Strategic Investments (RSIL), will soon be demerged from its parent company. On Saturday, RIL announced the record date for the demerger Reliance Strategic Investments, which will be renamed Jio Financial Services (JFSL).
The date was announced after National Company Law Tribunal on July 6 approved the scheme of arrangement. Following that, RIL said in a regulatory listing that it will now take the necessary steps for the demerger and subsequent listing of RSIL.
On Friday, the decision was taken at a board meeting of the company.
Record date
On Saturday, the oil-to-telecom services conglomerate said that the record date for determining the equity shareholders who are entitled to receive shares of Reliance Strategic Investments has been fixed to July 20.
Share allotment
As per the scheme, Reliance Strategic Investments will allot one fully paid-up equity share of RSIL of the face value of Rs 10 each, for every one share of Reliance Industries as of the record date.
"In accordance with the terms of the Scheme, Thursday, July 20, 2023 has been fixed as the Record Date for the purpose of determining the equity shareholders of the Company entitled to receive the Resulting Company New Equity Shares," RIL said in a regulatory filing, adding that the effective date of the demerger scheme is July 1.
Board members
The RIL board has also approved the appointment of McLaren Strategic Ventures' Hitesh Sethia as the CEO and MD of RSIL for 3 years.
Besides, former union home secretary Rajiv Mehrishi and PNB's former MD and CEO Sunil Mehta would also join the company as independent directors.
Isha Ambani, Mukesh Ambani's daughter, has also been appointed as a non-executive director of the new entity, which is subject to approval from the Reserve Bank of India (RBI).
Expected share prices
Global brokerage firm JPMorgan has estimated Jio Financial's share price at Rs 189, Centrum Broking has set a range of Rs 157-190. Jefferies has estimated that Jio Financial Services' share price would be around Rs 179 apiece.
Jio Financial Services’s market value
Jio Financial Services is expected to compete with the likes of Paytm and Bajaj Finance in the financing segment.
The company is estimated to have an underlying net worth of about Rs 1,50,000 crore, of which there are about Rs 1,10,000 crore worth of shares of Reliance Industries. The balance is in the form of the real net worth.
The financial services undertaking has investments in 6 companies - Reliance Industrial Investments and Holdings (RIIHL), Reliance Payment Solutions, Jio Payments Bank, Reliance Retail Finance, Jio Information Aggregator Services and Reliance Retail Insurance Broking.
After the demerger, JFSL will acquire liquid assets to provide adequate regulatory capital for lending to consumers, merchants, etc., and incubate other financial services verticals such as insurance, payments, digital broking, and asset management for at least the next 3 years of business operations.
Also read: Jefferies says Indian stock market not too expensive as earnings growth catches up
Also read: Reliance Retail opts for reduction of share capital at Rs 1,362 per share