Jio Financial Services Stock Rises 4% After First Post-Listing Quarterly Earnings; Profit Doubles!

Reliance-backed NBFC giant, Jio Financial Services performed steadily on Tuesday after posting its first quarterly earnings since listing. In the September 2023 quarter, the company's net profit doubled driven by robust growth in interest and dividend income.

In the early trade of Tuesday, Jio Financial touched an intraday high of Rs 233.50 apiece on BSE, rising by 3.85% from its previous day. Following this, so far in the day, the company's market cap jumped nearly Rs 5,500 crore to over Rs 1.48 lakh crore.

On the previous day, Jio Financial's share price stood at Rs 224.85 apiece with a market cap of nearly Rs 1.43 lakh crore.

On a consolidated basis, in Q2FY24, Jio Financial reported a net profit of Rs 668 crore, doubling or 101.31% from the profit of Rs 332 crore in Q1FY24. Total income zoomed by 46.82% to Rs 608 crore, as against Rs 414 crore in Q1FY24.

B&K Securities said that interest and dividend income from investments drives the profitability of Jio Financial. It also pointed out that PAT growth is 2x higher QoQ due to healthy operating profits, increased share of profits from associates & JVs and lower tax expenses.

During the quarter, Jio Financial's interest income was at Rs 186 crore, down by 7.83% in Q2FY24 versus Rs 202 crore in Q1FY24. The company recorded a dividend income of Rs 217 crore in the quarter under review. Further, its pre-provisioning operating profit shot up by 48.93% sequentially to Rs 537 crore in Q2FY24 as against Rs 360 crore in Q1FY24.

After the conference of Jio Financial, B&K said that the company is developing a unified JFS app to cater to the diverse financial needs of the customers. However, the company's lending business is yet to kick start with consumer loans and personal loans first to be launched.

In its investors presentation, Jio Financial said that it will increase financial services penetration by transforming and modernizing them with a digital-first approach. Also, it expects a strong capital base to fund growth strategy, meet regulatory requirements, and provide buffers for contingencies.

Apart from this, the company said that its experienced board and management team will ensure a high standard of Corporate Governance.

Lastly, JFS plans to democratize financial services for 1.42 billion Indians, giving them access to simple, affordable, innovative, and intuitive products and services.