Jio Financial Services (JFSL) shares are set to be removed from all the S&P BSE indices, including the Sensex, starting from Friday, September 1, as announced by the Bombay Stock Exchange (BSE). JFSL is a demerged non-banking financial services (NBFC) unit of Reliance Industries Ltd.
This move follows an earlier announcement by Asia Index Private Ltd, stating that JFSL would be excluded from all S&P BSE Indices. The decision was based on the fact that JFSL had recently spun off from its parent company, Reliance Industries, and was listed on August 21, 2023.
Despite some fluctuations, JFSL’s stock did not hit the lower circuit in the days leading up to the removal date. If it had, the removal date would have been extended, in accordance with guidelines.
The removal date had been previously postponed twice due to consecutive lower circuit hits following the listing.
On August 30, Jio Financial Services shares saw gains, reaching a 5% upper circuit limit on both the BSE and NSE, making it the top Nifty gainer.
Since its listing at ₹265 apiece on the BSE and ₹262 per share on the NSE, JFSL had been under pressure from institutional investors.
Analysts have weighed in on the situation. Prashanth Tapse, Research Analyst and Senior Vice President of Research at Mehta Equities, suggested that after its removal from the Sensex, JFSL’s volatility might decrease, and demand and supply could normalize. He also mentioned that risk-tolerant traders might consider accumulating shares around ₹218.
Mohit Gulati, CIO & Managing Partner of ITI Growth Opportunities Fund, noted that MSCI and FTSE indices would still include JFSL, and NIFTY might retain it as well, as long as price limits were met. Therefore, the Sensex exclusion might not have a significant impact on the stock.
In summary, Jio Financial Services’ removal from S&P BSE indices is scheduled for September 1, 2023, following its spin-off from Reliance Industries, with analysts suggesting potential changes in its trading dynamics.