Business · Companies · 2 hrs ago
Jio listing may narrow the discount on Reliance Industries shares
Jio Platforms was listed separately on 28 October, giving investors a way to buy into the digital and telecom business without investing in all of Reliance Industries.
Reliance owns 65% of Jio and also has oil-to-chemicals and retail businesses.
Investors often value a parent company below the combined worth of its businesses, a gap known as a holding-company discount.
Analysts say Jio’s listing has helped narrow that discount on Reliance from about 30% to 20–25%, and value Reliance’s stake in Jio at around ₹8.8 trillion.
Reliance’s market value rose to ₹17.5 trillion from about ₹16.15 trillion before the listing, although recent gains may also reflect improving investor sentiment.
Jio’s separate valuation could help Reliance shareholders over time, but a higher Jio share price will not necessarily lift Reliance by the same amount if investors continue to apply a large discount.
Jio Platforms’ listing may reduce the discount investors apply to Reliance Industries by making Jio’s value more visible.
Analysts say Reliance’s holding-company discount has narrowed from about 30% to around 20-25%.
Jio Platforms was valued at ₹13.5 trillion, putting the value of Reliance’s 65% stake at about ₹8.8 trillion before applying the discount.
Reliance Industries’ market capitalisation rose to ₹17.5 trillion from about ₹16.15 trillion before Jio’s listing.
Experts caution that the share gains may also reflect improved investor sentiment and that a higher Jio share price does not automatically raise Reliance’s valuation.
- Who
- Reliance Industries and Jio Platforms, with analysts discussing the effect on shareholders.
- What
- Jio Platforms’ listing may narrow the holding-company discount applied to Reliance Industries shares.
- When
- Jio Platforms listed on 28 October. Reliance shares and Jio Platforms shares were reported higher on Tuesday.
- Where
- Jio Platforms was listed publicly; the reported share prices were on the BSE.
- Why
- The listing gives Jio an independent market valuation, making its contribution to Reliance’s value more transparent.
This story does not have two clearly opposing sides.
A Religare Broking report said Jio Platforms’ listing could make its contribution to Reliance’s value more transparent and potentially narrow the holding-company discount.
Jio Platforms was publicly listed, giving investors a choice to invest directly in the digital and telecom business.
Reliance Industries shares settled 0.6% higher at ₹1,306.20, while Jio Platforms shares ended 1% higher at ₹1,437 on the BSE.
- Jio Platforms listing
- 28 October
- Reliance holding-company discount
- Narrowed from around 30% to approximately 20-25%
- Jio Platforms valuation
- ₹13.5 trillion
- Reliance stake in Jio Platforms
- 65%, worth around ₹8.8 trillion
- Reliance market capitalisation
- ₹17.5 trillion, up from approximately ₹16.15 trillion before Jio’s listing
What people are saying
With Jio now listed separately, investors can clearly see the value of RIL’s stake in the business
This has narrowed the holding-company discount from around 30% to approximately 20-25%, allowing RIL shareholders to capture more of the value previously unrecognised by the market.
Adani Enterprises is an example of how separately listed businesses can create shareholder value in the long run.