Shares of Jio Financial Services (JFS) surged nearly 4% after the company announced its fourth-quarter results.
Analysts viewed JFS’s calibrated approach to building an unsecured loan portfolio as a prudent move from the perspective of leverage build-up at the system level. They seemed positive on the non-banking financial company’s (NBFC) new initiatives.
As of 12:05 pm, JFS shares were trading 3.49% higher at ₹383.00 on the National Stock Exchange (NSE).
Post JFS’s Q4 results, Nomura India stated that while Reliance’s track record in disrupting the retail and telecom segments has been impressive, it believes lending is a secular business and a different game from the perspective of underwriting, collection, and analytics.
“Building and testing systems and underwriting algorithms may take a considerable amount of time. Further, in secured segments such as home/LAP loans, banks/large NBFCs are quite active, and it will not be easy to ramp up in secured segments,” Nomura India said.
In line with last quarter’s commentary and in response to concerns and regulatory changes around unsecured lending, JFS’s management emphasized its focus on building a secured book.
