Jio Financial shares: What Nuvama says on Nifty exclusion

Jio Financial Services (JFS), the demerged financial services business of Reliance Industries Ltd, could see a smooth Nifty exclusion by next week, said Abhilash Pagaria of Nuvama Alternative & Quantitative Research. To be sure, JFS shares have been excluded from Sensex and other BSE indices prior to the open of trading on Friday. In the final 30 minutes of trading on Thursday, the stock witnessed a total volume of around 6.4 crore shares, largely attributed to Sensex passive sellers.

On Friday, Jio Financial shares were trading at Rs 240.50, up 2.93 per cent.

JFS would not be removed until two consecutive days pass without the spun-off entity hitting the price band (upper or lower), said Nuvama Alternative & Quantitative Research. For instance, if JFS does not hit its price band on Friday (September 1) and Monday (September 4), its Nifty exclusion would take place on Tuesday (September 5).

"The stock exits Trade to Trade (T to T Segment) on September 4, likely facilitating the smooth exclusion next week as the circuit limit will revise (can move from 5 per cent to 10 per cent/20 per cent). The outflow will amount to approximately 105 million shares," Pagaria said in a note.

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JFS got listed at Rs 265 apiece on August 21, a 1.18 per cent premium over its discovered price of Rs 261.85 apiece on July 20. The stock is being admitted to dealings in the 'T' group securities on BSE. The stock will soon be out of T to T segment, facilitating easy exit, Pagaria said.

Global Indices MSCI & FTSE Indices maintained Jio Financial in the Index, with no impact on inflow or outflow.

At RIL's 46th AGM, Chairman and Managing Director Mukesh Ambani called Jio Financial as the fourth growth engine. He said JFS products will not just compete with current industry benchmarks but also explore path-breaking features such as blockchain-based platforms and CBDC.

"They will adhere to the highest standards of security, regulatory norms and ensure protection of customer transaction data at all times. 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," Ambani said.

JFS plans to consolidate its payments infrastructure with offerings for both consumers and merchants. Besides, the company is looking to enter the insurance segment to offer life, general and health insurance products. The company has presence in AMC business via partnered with BlackRock.

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