Jio Financial Services (JFS) has witnessed a significant rise in its share price in 2024, showing a year-to-date (YTD) gain of 40.75%. This outpaces the 12.02% increase in the benchmark BSE Sensex during the same period. With the company set to announce its second-quarter results for FY 2024-25, attention is building around its performance and its third joint venture with BlackRock.
Jio Financial Share Price Performance
As of Thursday, Jio Financial’s stock was trading 1.09% lower at Rs 330.20. Despite this dip, the stock’s YTD growth of 40.75% remains impressive, especially when compared to the broader market’s rise of 12.02%.
The upcoming Q2 results on October 18, 2024, are expected to be a pivotal moment for the company. Investors are also closely monitoring potential developments with BlackRock, a US-based asset management giant. According to sources, BlackRock is in discussions with Jio Financial to establish a private credit joint venture, which, if confirmed, would be their third collaboration.
BlackRock and Jio Financial: A Growing Partnership
BlackRock and Jio Financial have already formed two successful joint ventures. In April 2024, the companies launched a wealth management and broking business in India. This followed their 2023 asset management venture. If the private credit joint venture materializes, it will further solidify the partnership between these two financial giants.
Jio Financial’s recent regulatory approval for its mutual fund business has placed the company in the spotlight. The company’s strong brand presence and strategic moves into financial services position it well for future growth. Experts suggest that long-term investors should hold on to Jio Financial shares, given the company’s potential in India’s financialization landscape.
Technical Analysis: Key Support and Resistance Levels
From a technical perspective, the stock’s support is found in the Rs 325-320 range. Jigar S Patel, a Senior Manager and Technical Research Analyst at Anand Rathi, highlights that a decisive close above Rs 350 could drive the stock toward Rs 365. In the short term, the stock is expected to trade between Rs 320 and Rs 365.
Osho Krishan, Senior Research Analyst at Angel One, advises caution as the stock has seen some correction in recent sessions. He notes that a fall below Rs 320 could weaken the technical structure, but a recovery above Rs 345-350 would restore positive momentum. Similarly, Kushal Gandhi, Technical Analyst at StoxBox, recommends waiting for a close above Rs 360 before initiating new positions.
Jio Financial’s Shareholding and Valuation
As of June 2024, Jio Financial had a 47.12% promoter holding. The stock’s valuation is noteworthy, with a price-to-earnings (P/E) ratio of 686.96 and a price-to-book (P/B) value of 8.68. Its earnings per share (EPS) stood at 0.49, and the return on equity (RoE) was 1.26%.
These figures indicate that the stock is priced for high growth expectations, but investors should carefully consider its valuation metrics before making new investments.
Jio Financial’s Growth Potential in the Indian Market
Jio Financial’s entry into the Indian financial services sector comes at an opportune time. The country is experiencing rapid financialization of assets, with increasing demand for wealth management and investment products. Jio Financial’s ability to leverage its brand and reach, alongside its partnerships with global leaders like BlackRock, positions it as a key player in this evolving landscape.
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, believes that Jio Financial is well-placed to deliver strong performance in the future. He advises investors to maintain a long-term view on the stock, citing the company’s robust brand and the ongoing transformation of India’s financial sector.
Outlook for Q2 Results and Beyond
As Jio Financial prepares to release its Q2 FY25 results, investors will be keenly watching the company’s performance. Strong growth in profits and revenues could provide further upward momentum for the stock. The company’s focus on expanding its offerings in the mutual fund and private credit space through joint ventures with BlackRock could also serve as a catalyst for future growth.
Conclusion
Jio Financial Services has demonstrated robust growth in 2024, with a YTD rise of over 40%. With its upcoming Q2 results and potential third joint venture with BlackRock, the company is positioned for continued success. Investors should watch for key technical levels and wait for decisive moves before making new investments. However, the long-term outlook for Jio Financial remains positive, backed by its strategic partnerships and growth potential in India’s financial market.