Table of Content
Key Highlights
Jio Financial Services Limited (JFSL) is a non-banking financial company (NBFC) that was demerged from Reliance Industries Limited (RIL) in 2023. Here are some highlights of its Q3 FY24 results, which were announced on January 15, 2024:
- JFSL reported a net profit of ₹293.82 crore, a 56% quarter-on-quarter (QoQ) decline from ₹668.18 crore in the September quarter.
- The company’s revenue from operations was ₹413.61 crore, a 32% QoQ drop from ₹608.04 crore in the previous quarter.
- The company attributed the lower profit and revenue to the absence of dividend income, which was ₹217 crore in the September quarter.
- The company’s interest income increased by 45% QoQ to ₹270 crore, driven by higher lending activities.
- The company’s share price fell by over 6% on January 16, 2024, after the Q3 results were announced.
Additional Read: Q3 Results Dashboard
JFSL is one of the leading players in the digital finance space, offering a range of products and services such as payments, lending, insurance, investments, and advisory. The company has a customer base of over 400 million and a network of over 10,000 partners. JFSL aims to leverage its digital platform, data analytics, and artificial intelligence to provide innovative and customized solutions to its customers.
Strategic Business Initiatives:
Planning to launch a leasing business and supply chain financing to diversify services.
Secured Lending Focus:
Increased emphasis on secured lending, aligning with current market dynamics and regulatory changes.
Capability Building:
- Key leadership positions have been successfully filled, ensuring a robust team.
- As of December 31, 2023, the total number of employees stands at 516.
Technological Infrastructure:
The technology stack is in place, marked by the completion of the PL/CD sandbox.
Financial Performance:
- Consolidated Profit After Tax (PAT) for 9 months ending 2024 is reported at Rs. 1,294 crore (Q3-24 at Rs. 294 crore).
- Standalone PAT for the same period is Rs. 305 crore (Q3-24 at Rs. 71 crore).
Additional Check: Jio Financial Services Share Price
Working Population and Demographics
- India boasts a working population of 450 million, supported by favourable demographics.
- It stands as the 12th largest country in terms of the High Net Worth Individual (HNI) population.
Digital Financial Services Adoption
- The favourable demographics contribute to the increasing adoption of digital financial services.
- Factors like financialization of savings, rising affluence, and entrepreneurship further drive this trend.
Opportunities in Digital Financial Services (FY26E)
- Projected opportunity for a substantial digital financial services market, with an estimated Gross Written Premium (GWP) of ~INR 15 lakh crore (Life and Non-life).
- The Non-Banking Financial Company (NBFC) sector is anticipated to reach ~INR 60 lakh crore, and Mutual Fund Assets Under Management (MF AUM) to touch ~INR 79 lakh crore.
- Total Digital Payments are projected to be INR 3,892 lakh crore.
Indian Financial Landscape Growth
- The financial landscape of India is poised for significant growth in the coming decade.
- There is a substantial opportunity in the secured lending space, with a noticeable market response favouring secured products over unsecured lending.
- The industry is adopting a calibrated approach, with an accelerated focus on secured lending, including leasing as a product.
About Jio Financial Services
Jio Financial Services (JFSL) is a systemically important non-deposit-taking Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India (RBI). It was demerged from Reliance Industries (RIL) in 2023 and operates its financial services business through its consumer-facing subsidiaries and joint venture. JFSL offers a range of financial products such as loans, insurance, digital banking, UPI payments, and mutual funds to individuals and small businesses across India. JFSL’s vision is to digitally deliver financial products that promote the financial well-being of the people of India. JFSL’s shares are listed on the National Stock Exchange (NSE) under the symbol JIOFIN.
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