Last month, Reliance Industries received regulatory approval for the demerger, which was approved during the organization's board meeting on Friday.
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| Reliance Industries Announces Record Date for Spin-Off of Financial Services Wings |
Reliance Industries, the conglomerate owned by industrialist Mukesh Ambani, has disclosed the record date for the spin-off of its financial services subsidiary, Reliance Strategic Investments. The company has set July 20 as the record date for the demerger, following which the financial services arm will be known as Jio Financial Services.
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Last month, Reliance Industries received regulatory approval for the demerger, which was approved during the organization's board meeting on Friday. The spin-off is expected to unlock value for Reliance Industries' 3.6 million shareholders. Under the demerger scheme, Reliance shareholders will receive one share of Jio Financial for each share they hold. Over the past three months, Reliance Industries' stock has gained nearly 13 percent.
"As per the terms of the scheme, the entitlement to receive new equity shares of the company has been fixed on the record date of July 20," stated Reliance in a filing with the regulator. However, the demerger scheme will come into effect from July 1. Additionally, the company announced the appointment of Isha Ambani, daughter of Mukesh Ambani, as a non-executive director of the financial services firm, pending approval from the Reserve Bank of India. The date for Reliance's Annual General Meeting is yet to be announced, and the roadmap for Jio Financial Services' listing on the stock exchange is expected to be developed before September.
Brokerage firm JPMorgan estimates that Jio Financial Services' share price could be around Rs 189, while Jefferies and Centrum Broking suggest a range of Rs 157-190. Reliance's target price is set at Rs 2,960, indicating that the underlying value of the company may increase in the future.
According to Centrum Broking, Jio Financial Services will become the fifth largest financier in India in terms of capital, directly competing with companies such as Paytm and Bajaj Finance. The combined total assets of Reliance Strategic Investments Ltd and Jio Financial Services amount to Rs 280 billion, including Reliance Industries' 6.1 percent stake.
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