The Reliance Industries Limited (RIL) board approved a scheme of arrangement among RIL, Reliance Strategic Investments Limited (RSIL) and their respective shareholders and creditors in which RIL will demerge its financial services undertaking into RSIL — to be renamed Jio Financial Services Limited (JFSL)
JFSL would be listed on the Indian stock exchanges. The RIL shareholders will get one equity share of JFS per one equity share held in RIL.
JFS would be in the lending, insurance, asset management and digital broking segments, a press release said.
The corporate and capital structure would enable RIL shareholders participation in an exponential business growth, the company said.
At present, RSIL is a wholly-owned subsidiary of RIL and is a RBI-registered non-Deposit taking Systemically Important (ND-SI) Non-Banking Financial Company.
RIL's investment in Reliance Industrial Investments and Holdings Limited (RIIHL), which is a part of the financial services undertaking of RIL, will stand transferred to JFSL.
JFSL's plans
JFSL would also be building a large digital fintech platform. "JFSL and its subsidiaries (JFS) will leverage the technology capability of Reliance and focus on digital delivery of financial products to democratise financial services access for 1.4 billion Indians," the company added in the statement.
JFS plans to launch a consumer and merchant lending business based on proprietary data analytics to complement and supplement the traditional credit bureau-based underwriting
JFS will continue to evaluate organic growth, joint venture partnerships as well as inorganic opportunities in insurance, asset management and digital broking segments
RIL Chairman and Managing Director Mukesh Ambani said JFS will be a truly transformational, customer-centric and digital-first financial services enterprise offering simple, affordable, innovative and intuitive financial services products to all Indians.
"JFS will be a technology-led business delivering financial products digitally by leveraging the nation-wide omni-channel presence of Reliance's consumer businesses. JFS is uniquely positioned to capture multiple growth opportunities in financial services bringing millions of Indians into formal financial institutions," he added.
RIL on Friday also reported a consolidated revenue of Rs 2.3 lakh crore for the July-September period, up 5 percent compared with the previous quarter and in line with Street estimates.
Its consumer-facing businesses — Reliance Retail and Jio Platforms — delivered a strong quarter, but the O2C unit was under pressure owing to subdued demand and a weak margin environment.
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