Shares of Jio Financial Services Ltd had a weak listing on Monday last week on BSE and NSE. Jio Financial Services share price opened at ₹262 and within few minutes of listing the stock went on to hit lower circuit. However, weakness in Jio Financial share price continued further and the scrip went on to hit lower circuit on all five sessions last week. However, after making record low of ₹202 on NSE, some buying interest was witnessed during Friday deals and the scrip ended at ₹221 apiece levels, losing over 18 per cent from the listing price.
According to stock market experts, Jio Financial share price may continue to witness ‘sell on rise’ pressure as fair value of the stock comes around ₹150 to ₹160 per share levels. They said that fair market value of the stocks comes around ₹1.10 lakh crore while it ascended to the tune of 60 to 65 per cent higher ahead of demerger from Reliance Industries Ltd.
On outlook for Jio Financial Services shares, Omkar Kamtekar, Research Analyst at Bonanza Portfolio said, “Jio Financial share price has been locking lower circuit since listing despite LIC buying 6.66 per cent stake in the company. The reason for this slide has been index funds that hold JIOFIN, both domestic and foreign who would be forced to exit once the impending exclusion of the scrip from the index is confirmed.”
Reliance AGM 2023 in focus
Advising stock market investors to remain vigilant about the Reliance AGM scheduled on Monday, Bonanza Portfolio expert said, “At current juncture JIOFIN the scale of business is nominal but has plenty of opportunities for organic and inorganic expansion and hence D-street is pricing in the same. While JIOFIN has announced its tie-up with Blackrock, the world’s largest asset manager, to float a mutual fund company, no formal announcements of a foray into the lending business has been made. However, there is a consensus that JIOFIN would commence operations in the consumer financing space leveraging the wide network of Reliance Retail and Reliance Jio. Hence, investors would tune in to the commentary that the management would deliver in this regard during the upcoming AGM on 28th Aug, 2023.”
Speaking on Jio Financial share price outlook, Saurabh Jain, Vice President — Research at SMC Global Securities said, “Fair value of Jio Financial share price comes around ₹150 to ₹160. So, the stock may continue to remain an ideal sell on rise stock on Dalal Street as market cap of the stock at the time of demerger waas around ₹1.10 lakh crore. However, due to heavy buying of Reliance shares ahead of demerger it apprecited to the tune of 60 to 65 per cent. Hence, correction in the stock post-listing was expected.”
Motilal Oswal Mutual Fund buys stake in JFSL
Despite weak listing of Jio Financial Services shares on Indian stock market bourses, Motilal Oswal Mutual Fund bought stake in the Reliance group company. As per the information available on NSE website, Motilal Oswal Mutual Fund bought 3.72 crore Jio Financial Services shares on Friday paying ₹202.80 per share. This means, Motilal Oswal Mutual Fund bought Jio Financial Services shares worth ₹7,54,41,60,000 ( ₹202.80 x 3,72,00,000) or ₹754 crore.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
Download The Mint News App to get Daily Market Updates.
Updated: 26 Aug 2023, 10:36 AM IST