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Kolkata: In order to take their stake to above 51%, the Ambanis will inject Rs 15,825 crore in Jio Financial Services, as the first step to further bolster its presence in the domains of investing, financing, insurance broking, payment bank, payment aggregator and payment gateway services where it is already marking a strong presence.
Jio Financial Services was carved out of Reliance Industries and spun off as a distinct entity to become a leading name in the financial services business. It was listed in the stock exchanges in August 2023.
Incidentally, Jio Financial Services recently grabbed headlines by launching a high-profile AMC Jio BlackRock Investment Advisers in a 50:50 joint venture with the BlackRock group, which is an US MNC and the world's largest asset management firm. It has launched several mutual fund schemes and is preparing to unveil a few more this year.
On July 30, Jio Financial Services board decided to raise the stake of the Ambanis through a preferential allotment of convertible warrants. The current stake of the Ambanis is 47.12%, which will jump to 54.19% after the preferential issue of convertible warrants. (Usually a share warrant is an instrument that bestows the right to buy a stock at a predetermined price within a stipulated time period.)
According to reports, each warrant will be convertible into a fully paid-up equity share of Jio Financial Services of face value of Rs 10 each at a premium of Rs 306.50. These will amount to Rs 15,825 crore, by way of preferential issue on a private placement basis to the promoter entities.
After the preferential issue, one of the vehicles of the Ambanis, Sikka Ports & Terminals, will come to hold 4.65% in the company. Its current stake is 1.08%. The stake of Jamnagar Utilities and Power will surge to 5.52% from the current level of 2.02%.
Jio Financial Services came up with Q1 results that showed a 4% rise in consolidated net profit to Rs 325 crore. The net profit figure for the corresponding quarter last year stood at Rs 313 crore. However, the total income rose by a far higher margin -- 48% between the Q1 periods of FY25 and FY26. While the revenues was Rs 619 crore in Q1 for FY26, it stood at Rs 418 crore in the corresponding period last year. Interest income reported an even higher jump -- 124%. While it was Rs 162 crore in Q1 of FY25, it zoomed to Rs 363 crore in Q1 of FY26. But there was a jump in total expenses too -- from Rs 79 crore in Q1 last year to Q1 FY26.
(Disclaimer: (Disclaimer: This article is only meant to provide information. TV9 does not recommend buying or selling shares or subscriptions of any IPO, Mutual Funds, precious metals, commodity, REITs, INVITs, any form of alternative investment instruments and crypto assets.))
