Reliance Industries - Demerger and listing of Jio Fin services

Reliance finally announced the demerger of financial services and consequently, the listing of Jio fin services with RIL shareholders get 1 share in Jio fin services for 1 share (basically, 1:1 ratio)

It goes without saying ,financial services arm of reliance can potentially be a game changer in the lending and fintech space.

Your initial thoughts on this announcement?

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What else? It’s :partying_face:

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Is Ex Date for eligibility declared or the process is still is progress?

As the information is just released, there should be days to buy.

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Great news! :innocent:

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Finally reliance weightage in index will come down. :+1:

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Or it is possible that reliance will have multiple stocks in index :stuck_out_tongue_winking_eye:

Very much a possibility but for that I feel Jio telecom has to get listed. If it gets the valuation Bharti has then for sure it will be included in nifty. :metal:t2:

Reliance has plans to diverge itself into multiple entities as the ownership is being passed on to Childrens of Mukesh Ambani.

Since the PAT dipped hugely in current quarter, to prevent the share price from falling they announced the demerger of Jio Fin Services in a rush.

Comparing Airtel with Jio, we can see that currently Jio is little bit behind Airtel in terms of total Revenue but they are progressing fast and now became the largest fixedline service provider in India overtaking BSNL.

Airtel has huge debt ie 1.7 Lakh Crore whereas RJio is majorly funded by Shareholders. (I’m unable to figure out what is 1.1 Lakh Crore deferred payment liabilities of RJio)

So when RJio gets listed it will be included in Nifty 50 for sure.

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I guess it’s deferred tax liability.

For this reason I feel Jio will get good valuation. I won’t be surprised if it gets better valuation than Airtel.

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Jio’s plans are around 20% cheaper than Airtel. Probably that’s the reason for less revenue. If tomorrow, the decide to be at par with Airtel in terms of pricing, they can increase their revenue overnight. There won’t be any subscriber churn due to this as others are offering similar tariff.

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That much amount doesn’t makes sense at all because because Jio hasn’t been making that much profits, neither it has acquired huge assets, causing the depreciation disparity to turn it into tax liability.
I think its 5G bidding price wherein Jio outrightly bought spectrum for Rs88,000 Crore and may have made further provisions for next biddings.

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The street knows what valuation to pay for any offering from Reliance, w.r.t. the market cap it has, and the diversification and disruption it was able to do and hopefully continue to do in the future too, if not by the successors themselves alone, but with the help of professionals too.

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Anybody knows what Jio Fin Services does exactly, the kind of product it offers, its revenue make up, profitability etc?

I read all the news articles covering the topic but all were vague and not much helpful.
RIL is giving division wise revenue, profitability for Power, Retail and Jio but none dedicated to Jio Fin Services.

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https://www.ril.com/getattachment/ebf24ca3-ea98-427b-a359-9d0bc30c80f1/Reliance-Industries-Limited-(-RIL”)-to-Demerge-Fin.aspx

I was just guessing. Every chance that I am wrong. :smiley:

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They’ve a payment bank called Jio Payment Bank which is a JV between Jio and State Bank of India
They also have their Payment and UPI app Jio Money something like Paytm, Phone Pe.

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Mostly likely gonna be a super app like Paytm or Bajaj finance and provide financial services.

Their cost of capital is generally among the lowest in the entire market. Gonna be interesting to see how it shapes up

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A nice read on various options and challenges that reliance might be against in financial services space