Jio Financial Services Share Price Faces 3% Decline Prior to Exclusion from NSE Indices; Anticipates $324 Million in Passive Selling

Jio

Jio Financial Services Ltd (JFSL), the separated non-banking financial services arm of Reliance Industries led by Mukesh Ambani, is poised to be removed from the Nifty 50 and other NSE indices on September 7.

The Downturn in Jio Financial Services Share Price

Early on Wednesday, Jio Financial Services experienced a dip of over 3% in its share price. This decrease comes in response to the imminent removal of the stock from NSE indices, set to take effect on September 7. The share price of Jio Financial Services declined by as much as 3.23%, settling at ₹246.85 per share on the BSE.

NSE’s Announcement on JFSL’s Exclusion

The National Stock Exchange (NSE) officially announced the exclusion of Jio Financial Services Ltd (JFSL) from multiple indices, including Nifty 50, Nifty 100, Nifty 200, Nifty 500, Nifty Energy, Nifty Commodities, and Nifty Oil & Gas, effective September 7. This decision comes in the wake of BSE indices’ similar action last week. Remarkably, the stock will continue to be featured in MSCI and FTSE indices.

Passive Fund Adjustments in the Offing

With JFSL’s impending removal from NSE Indices, passive funds linked to these indices are gearing up for a portfolio overhaul. The transition is scheduled for September 6 during the final 30 minutes of trading.

According to Nuvama Alternative Research, an estimated 105 million shares, equivalent to a staggering $324 million, are projected to be part of the passive selling process.

Smooth Transition Expected

Abhilash Pagaria from Nuvama Alternative & Quantitative Research opines that the revised 20% price band should facilitate a seamless exclusion process, reducing the likelihood of significant disruptions. Notably, stock exchanges had recently increased the price band for Jio Financial shares from 5% to 20%, with this change taking effect from Monday, September 4.

Current Market Performance

As of 9:55 am, Jio Financial Services shares are trading 2.63% lower at ₹248.40 per share on the BSE.

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