Jio Financial Services to Be Excluded from Sensex Index on September 1

Jio Financial Services (JFS), the demerged financial business arm of Reliance Industries, is scheduled for removal from the BSE, as announced on Thursday, August 31.

According to the BSE, effective prior to the commencement of trading on Friday, September 1, 2023, Jio Financial Services Ltd will be eliminated from all the S&P BSE Indices. This action stems from its spin-off from its parent company, Reliance Industries, following its listing on Monday, August 21, 2023.

Originally, the stock was set to be delisted on August 23, just two days after its initial listing on August 21. However, this plan faced delays due to Jio Financial Services remaining locked in the lower circuit.

On August 31, the stock demonstrated a three-day consecutive increase, closing at an upper circuit of 5%, reaching INR 242.50 per share. According to Nuvama Alternative Research, JFS constitutes 1.1% of Sensex’s weight, potentially resulting in passive selling of approximately 60 million shares, valued at around $180 million.

Nuvama has noted that Jio Financial won’t be removed from Nifty indices until the newly formed entity avoids price limits, either upward or downward, for two consecutive days. The research firm explained that Nifty will issue a press statement confirming the exclusion only if price band breaches are avoided for two consecutive days, with no communication during this interim period.

In contrast, MSCI and FTSE indices will continue to include Jio Financial Services without any impact on inflow or outflow.

During the 46th Annual General Meeting (AGM) of Reliance Industries on Monday, August 28, Chairman Mukesh Ambani announced that JFS would expand its product offerings in the payments and insurance sectors in India, in addition to its involvement in asset management.

Ambani stated, “In payments, JFS will consolidate its payment infrastructure with a comprehensive offering for both consumers and merchants, further promoting digital adoption.” He added that JFS products would not only compete with existing industry standards but also incorporate innovative features such as blockchain-based platforms and the central bank digital currency (CBDC).

JFS was established last year following RIL’s announcement of the demerger of its financial services business and the spin-off of Reliance Strategic Investments as Jio Financial Services.

Ambani also asserted that, prior to the delisting announcement, JFS had become the world’s most highly capitalized financial services platform at its inception. The company maintains its focus on lending, insurance, payments, and investments.

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Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.

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