Reliance Industries announces Jio Financial Demerger on July 20th. What’s the whole story?

One of India’s most prosperous corporations is Reliance Industries. The history of this organization is rich with case studies and business ventures that have inspired generations of entrepreneurs.

Today, news has been broadcasted through the channels of a demerger within Reliance Industries Ltd.

Let’s analyze this sensational story!!

The Facts:

Reliance Industries Ltd(RIL) announce July 20th as the record date for the demerger of its financial services wing names Reliance Strategic Investments. It was announced that it would be renamed Jio Financial Services(JFSL)

This strategic decision was taken at a board meeting of the company yesterday after getting regulatory approval on the demerger last month.

This strategic move has attracted a strong buying interest among traders in the Indian stock market during the morning sessions. The share prices of Reliance opened upside and went on to hit an intraday high of INR 2756 a share on NSE and breached the previous lifetime high of INR 2755 per share. While on the uptrend, it hit a new milestone by surpassing INR 18 lakh crore market cap.

Finalizing the Record Date:

On the previous Saturday, RIL conducted a board meeting in which Jio Financial Service’s demerger record date of 20th July 2023 was announced. The board says “Our letter dated July 6, 2023, has intimated that the Hon’ble National Company Law Tribunal, Mumbai Bench has sanctioned the scheme,”. This is expanded by the statement that reads, “In accordance with the terms of the Scheme, Thursday, July 20, 2023, has been fixed as the Record Date for the purpose of determining the equity shareholders of the Company entitled to receive the new equity shares.”

Reliance Industries went on to disseminate the following information as well:

On July 1, 2023, the plan will go into force.

Regarding the share situation, Reliance Strategic Investments Limited (“RSIL”) shall issue and allot 1 (one) fully paid-up equity share of RSIL having face value of 10 (Rupees Ten) each for every 1 (one) fully paid-up equity share of the Company having a face value of 10 (Rupees Ten) each (the “Resulting Company New Equity Shares”) to the shareholders of the Company whose names are listed in the register of members and/or records of the depository as on the Record date.

Final Note:

More information is yet to come in the upcoming days, however, this strategic move has probably skyrocketed Reliance shares to a new high. Traders will have to wait and see for further development regarding the events.

We’ll be back with more info soon, so until then.

Happy Trading!!

Commodity Samachar
Learn and Trade with Ease