Jio Financial Services, which has been spun off from RIL, was listed on August 21, ahead of its original schedule. The filed documents indicate that its operational scope might encompass diverse areas such as consumer and merchant lending, a payments platform, insurance broking, asset management, and other non-banking financial activities. The management is relying on bolstering the team and leveraging digital platforms to drive the company’s growth. With a net worth of Rs 1.1 trillion, the company’s OCI (other comprehensive income) gain stands at Rs 671 billion, while the investment cost in group companies totals Rs 154 billion. The calculated exchange-derived price is Rs 262 per share, factoring in the valuation of the stake in RIL and approximately a 2x multiple on the core price-to-book ratio.
The Information Memorandum outlines Jio Financial Services’ key business areas: retail lending, merchant lending, payments bank operations, payments solutions, and insurance broking. Consumer lending initially targets financing for retail-sold consumer durables, with plans to expand to secured loans. Merchant lending prioritises grocery, digital, fashion, and pharma merchants. The SME segment focuses on working capital loans. Jio aims to enhance merchant-focused payment platforms, strengthen Jio Payments Bank, and establish insurance broking services. Additionally, a joint venture with BlackRock is set to launch an AMC business alongside potential other ventures. The shareholding of Jio FS replicates that of its erstwhile parent, RIL, with promoters holding 46% stake. KV Kamath is the chairman. While teams are being built across segments, management is planning to intensely focus on digital platforms across verticals. Its asset-backed balance sheet, strong credit rating and promoter backing would also help get access to funds at cheaper rates, especially after merger of HDFC Ltd with HDFC Bank.