Mukesh Ambani's One After Another Free Offer - What Benefit Will 3.6 Million Investors Get? Find Out All the Details Here
Highlights:
- Reliance is demerging its financial business.
- Shareholders will receive one share of the new company for each share they hold.
- Reliance has over 36 million shareholders.
New Delhi: India and Asia's largest tycoon, Mukesh Ambani, announced a one-for-one free offer for Reliance Industries' shareholders on July 8. Since then, there has been a frenzy among retail investors to purchase Reliance shares. This frenzy finally ended today as the record date for the demerger of Reliance's financial business is July 20. Successful investors in acquiring Reliance shares will receive one share of Jio Financial Services Limited (JFSL) for each Reliance share they own. On Wednesday, the share price closed at Rs. 2840 with a gain of 0.62%. Reliance has over 36 million investors. Let's find out what this one-for-one free offer means for them.
How many shares will investors receive?
After the trading session ends today, all Reliance shareholders will become entitled to one share of JFSL with a one-to-one ratio. For example, if you currently hold 100 shares of Reliance, you will receive 100 shares of JFSL.
What will be the share price?
The constant price of JFSL will be determined on Thursday. For this purpose, there will be a special pre-open session for Reliance shares on NSE and BSE from 9 AM to 10 AM. This price will be different from the closing price of Reliance today and will be determined during the pre-open session.
What is the estimated valuation?
JFSL is valued at over Rs. 1 lakh crore. Brokers have estimated the share price to be between Rs. 160 and Rs. 190. Axis Securities estimates it at Rs. 160, while Nuvama values it at Rs. 168, JP Morgan at Rs. 189, and Jefferies at Rs. 179.
Why the demerger?
Reliance believes that there is a need for a separate strategy for the expansion and growth of its financial services. The nature and competition of this sector are different from other sectors. The mindset of investors, partners, lenders, and other stakeholders in this sector is also unique. This demerger will unlock value for Reliance shareholders.
What will be JFSL's business?
For more information on this, Mukesh Ambani can provide details in the AGM. It will include Reliance Industrial Investment and Holdings, Reliance Payment Solutions, Jio Payments Bank, Reliance Retail Finance, Jio Information Aggregator Services, and Reliance Retail Insurance Broking.
When will the company be listed?
JFSL is expected to be listed in the next two to three months. More clarity on this can be gained during Reliance's AGM. The date for Reliance's AGM has not been announced yet, but it could take place in July or August.
What happens to Reliance after the demerger?
When Reliance demerged four companies in 2005, its share price rose by 38% in 2006. Jay Iran, of Nuvama, says that a similar trend could be seen this time as well, and its price could rise by three to five percent.
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