Jio Financial shares resume fall as stock slips 2% today; here's what you should do

Shares of Jio Financial Services Ltd on Monday returned to the negative territory after a brief single-day halt. The stock fell 1.90 per cent to settle at Rs 341.40. At this price, the scrip has declined 13.50 per cent from its record high value of Rs 394.70, a level seen on April 23 this year. Despite the mentioned drop, the counter has gained 45.52 per cent on a year-to-date (YTD) basis.

The company has recorded a consolidated net profit of Rs 310.63 crore in the fourth-quarter (Q4 FY24), up 5.72 per cent sequentially from Rs 293.82 crore in December quarter (Q3 FY24). The non-banking financial services company's (NBFC's) consolidated PAT (profit after tax) for FY24 (2023-24) stood at Rs 1,605 crore.

Analysts largely remained 'positive' on the counter. One of them said Jio Financial would be shoring up its capital and, thanks to its parentage, it would have access to crores of retail customers and telecom subscribers. Sooner or later, JFS would be attracting a few global strategic players for its financial services, the person added.

G Chokkalingam, founder and MD of Equinomics Research, said, "We firmly believe that in the long-term, the value of Reliance Industries shares can be used to shore up its financial net worth and the same can help JFS in growing its lending book exponentially. JFS has access to nearly 25 crore retail customers and 44 crore telecom subscribers of Reliance. JFS will emerge as a giant in the whole gamut of financial services within three to five years. Reliance has already proven its capability to build leadership in the retail and telecom businesses. We are pretty confident that JFS can attract a few more global leaders in various segments of financial services and will emerge as a leader in the financial services business as well in the long-term."

Chokkalingam continued to maintain a 'Buy' recommendation on JFS shares with a target price of Rs 430.

The NBFC has recently entered into a pact with BlackRock. Jio Financial said it has signed an agreement with BlackRock Inc and BlackRock Advisors Singapore Pte Ltd to form a 50:50 joint venture (JV) for setting up a wealth management and broking business in India. This was Jio and BlackRock's second JV. The duo had launched an asset management venture last year.

Shiju Koothupalakkal, Technical Research Analyst at Prabhudas Lilladher, "The stock has recently witnessed a decent correction and has shown signs of bottoming out near Rs 336 level with a pullback seen to end near the Rs 348 zone. A decisive breach above Rs 358 shall improve the bias and thereafter one can anticipate for a further rise in the coming days with targets of Rs 372 and Rs 386 levels visible. At the same time, a slip below Rs 336 shall further weaken the bias triggering a fresh downward move."

Ravi Singh, Senior Vice-President (Retail Research) at Religare Broking said the stock can hit an upside target of Rs 360 in the near term. Keep stop loss placed at Rs 320, Singh mentioned.

On BSE, around 31.88 lakh shares changed hands today. The figure was higher than the two-week average volume of 26.47 lakh shares.

Turnover on the counter came at Rs 108.58 crore, commanding a market capitalisation (m-cap) of Rs 2,16,901.12 crore.