Jio Financial shares tank 5% for 4th day, m-cap down Rs 31,200 crore; all eyes on RIL AGM

Shares of Jio Financial Services (JFS) on Thursday hit lower circuit limit for the fourth day in a row, erasing about Rs 31,200 crore off its market capitalisation (m-cap) since its listing on Monday. While deferring the exclusion of JFS from stock indices by three days, the index committee of Asia Index Private Limited had said that should JFS continue to hit lower circuit on the next 2 days, the removal date will be deferred by another 3 days. All eyes are now on

On Thursday, Jio Financial shares were locked at Rs 215.90 on BSE, down 5 per cent. JFS was supposed to be excluded from stock indices from August 24. The demerged business of Reliance Industries saw its m-cap falling Rs 31,194.62 crore to Rs 1,37,167.41 crore from Rs 1,68,362.03 crore at the time of listing.

"Additionally, should JFSL not hit the lower circuit limit on either of the next 2 days, but hits the lower circuit limit on the 3rd day, the removal of JFSL from all the S&P BSE Indices will be deferred by another 3 days. Any postponement of a removal will be communicated as soon as possible; any changes to this approach would be announced via the standard channels," Asia Index Private Limited said.

Watch: Jio Financial shares hit lower circuit for 4th day straight, plunge 20% since listing; should you buy, hold or sell ahead of RIL AGM? See what analysts say

At exclusion, Nifty index passive trackers could sell around 9 crore shares, which is equivalent to approximately $290 million. Alongside Sensex index trackers could sell 5.5 crore shares, which is equivalent to $175 million, Nuvama Institutional Equities said this week.

“JFS’ listing was somewhat subdued compared to market expectations of Rs 300 plus. Short-term selling pressure would continue looking at seller mood, which has increased multifolds in the last 3 days. Jio Financial shares will be in the Trade-To-Trade (T2T) segment for 10 trading days. Under the T2T segment, stocks have to be bought only under the delivery method and are not eligible to be traded on an intraday basis," said Prashanth Tapse, Research Analyst Sr VP Research, Mehta Equities.

"The stock will have a 5 per cent circuit filter for the ten trading sessions. Only after the RIL AGM on 28th August, we can expect some development in the JFS’ business plan. We stand neutral on the counter and wait for the AGM development, which can give a clear picture on the future outlook,” Tapse said.

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