Shares of Reliance Industries surged over 5% in trade today as the company moves a step further to to demerge its financial services business. Shares of Reliance Industries today hit a high of Rs 2,338 against its previous close of Rs 2,255. The company is likely to decide on the demerger in a board meet likely on May 2. The entity will be renamed to Jio Financial Services.
Jio Financial Services could be the 5th largest financial services company in India in terms of net worth. The company will further not need a new license as Reliance already has a NBFC licence which it can leverage to kick start consumer and merchant lending. Macquarie in its report had said that the new entity could be a real threat to fintech business models.
Brokerages like CLSA, Kotak and JP Morgan have a positive rating on the stock, with targets of Rs 2,970, 2,900, and Rs 2,960, respectively.