Jio Financial Services, the financial services arm of Reliance Industries, listed on the bourses today near its exchange-derived price but slid lower to trade at 5% lower, the maximum permitted to fall in the trade-to-trade category.
JFS, which demerged from incubator Reliance Industries last month, got listed at 262 per share on NSE and Rs 265 on BSE, which is near the exchange-derived price of Rs 261.85 on the demerger record date of July 20.
On the NSE, shares of JFS were trading 5 per cent lower at Rs 248.90 apiece, while its shares were trading at Rs 251.75, also down 5 per cent, on the BSE, giving it a market capitalisation of almost Rs 1.59 lakh crore.
Over the next 10 days, JFS will be actively traded in the Trade-to-Trade (T2T) segment, which means that shares of JFS can only be purchased for delivery, with no provision for intraday trading, and upper and lower circuit breakers of 5%.
Fall predicted
Analysts had flagged the limited potential for significant price movements in the stock due to a 5% circuit limit. There may be short-term selling pressure from arbitrage players, who purchased RIL stock as a unique opportunity to acquire one share of JFSL for each RIL stock held.
Some of these arbitrage traders and RIL investors, who aren’t inclined to retain holdings in the financial sector, have decided to secure their profits. Shortly after the stock’s debut on the exchanges, a series of block deals ensued. As a result, the shares of JFSL swiftly reached the lower circuit limit of a 5% decline on both stock exchanges.
The shareholding of Jio Financial has a promoter holding of 46%. State-run LIC has a 7% stake, while other top investors include Bank of New York Mellon, SBI MF, Europacific Growth and the Singapore government with 2% each.
