📌 At a Glance
Reliance’s not-so-little fintech baby is worth ₹1.8 lakh crore, earns ₹1,600 crore in profit, and has an ROE that looks like your savings account. Is this the future of finance — or a future PowerPoint presentation?
🔍 1. The Great De-merger of Destiny
Let’s be clear — Jio Financial Services Ltd (JFSL) was born from Reliance’s balance sheet like a new IPO gets born from a Google Sheet.
- Originally: Reliance Strategic Investments Ltd
- Became: Jio Financial Services Ltd (2023)
- Registered as: Core Investment Company (CIC), Non-Deposit Taking, Systemically Important — basically SEBI’s version of “Don’t mess this up.”
What does JFSL actually do?
🧵 It’s the “holding co.” for:
- 🏦 Jio Payments Bank (now 100% owned, SBI sold their stake this week)
- 📱 Jio Finance Ltd (consumer loans)
- 🛡️ Jio Insurance Broking Ltd
- 💳 Jio Payment Solutions Ltd
- 🖤 And now… Jio BlackRock Investment Advisers Pvt Ltd
So if your grandma, cousin, ex, and UPI ID all took a loan from Jio, it technically goes into different Jio subsidiaries.
💰 2. Financials: Billion-Dollar Baby, Crawling Returns
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue (₹ Cr) | 45 | 1,855 | 2,043 |
| Net Profit (₹ Cr) | 31 | 1,605 | 1,613 |
| OPM (%) | 88% | 84% | 76% |
| ROE (%) | — | 2.0% | 1.2% |
| Cash Flow from Ops (₹ Cr) | +2,055 | -678 | -10,083 (!) |
Let’s pause there. ₹1,600 Cr net profit and -₹10,000 Cr operating cash flow?
Even Baba ka dhaba doesn’t show this level of accrual-based optimism.
🤖 3. Valuation: P/E = 112. Bro, Why?
Let’s compare:
| Company | P/E | ROE (%) | MCap (₹ Cr) |
|---|---|---|---|
| Jio Financial | 112 | 1.2 | 1,80,591 |
| Aditya Birla Capital | 20 | 9.3 | 66,740 |
| Chola Finance | 17 | 10.5 | 37,074 |
| Tata Investment Corp | 104 | 1.2 | 32,495 |
| JSW Holdings | 118 | 0.8 | 23,166 |
Conclusion: You’re paying Tata + BlackRock prices for PSU-grade returns.
🧮 4. Fair Value Range — Because We Do Math Here
Assumptions:
- FY25 EPS = ₹2.54
- Sector avg P/E (NBFC holding cos) = 25–35x
- Fair Value = ₹64 – ₹89
🤡 Market Price = ₹284
📉 Overvalued by 3x+ — unless Ambani drops a bonus NFT.
🧠 5. What’s Cooking Inside Jio HQ?
Recent moves:
- 🏦 Acquired SBI’s entire stake in Jio Payments Bank — now a full subsidiary
- 🤝 Launched Jio BlackRock JV — investment advisory & AMC license soon?
- 📈 Already pitching to institutional investors on Citi’s roadshow (June 2025)
- 💸 Dividend payout began (finally!) at 20% of FY25 profits
This is Mukesh bhai’s big fintech bet — distribution is sorted (Jio + Reliance Retail), but monetization is just starting.
But right now, this thing prints press releases faster than profit.
🧠 6. The Big Risk: Valuation Bubble?
- ROE: 1.2%
- P/E: 112
- Free cash flow: Negative
- Holding structure: No lending arm on its own books (subsidiary-driven)
- Market Cap: More than the GDP of Bhutan 🇧🇹
Why are people buying?
- “Reliance ka hai bro”
- “Aage kuch bada karega”
- “Akhilesh bhai ne YouTube pe bola hai”
You do you. But remember: great stories don’t always equal great returns.
🥲 7. TL;DR: Jio Hype + Fintech Type = Buy the Dip Trap?
- ₹1.8 lakh crore market cap… on 1.2% ROE.
- Solid subsidiaries — but the consolidated cash flow is scary.
- P/E of 112… is not “undervalued,” it’s unbelievable.
- Our Fair Value = ₹64–₹89 based on current EPS and sector multiples.
Would we touch this before Jio BlackRock or Jio Lending takes off? Nah. Not even with a free Jio SIM.
✍️ Written by Prashant | 📅 19 June 2025
Tags: Jio Financial Services, Reliance demerger, NBFC, Fintech, Jio BlackRock, Ambani stocks, overpriced stocks, fair value calculation, Indian finance sector, EduInvesting roast
