Jio Financial Services’ conversion to a Core Investment Company (CIC) from a Non-Banking Finance Company (NBFC) has been approved by The Reserve Bank of India (RBI) as of Thursday as per the company filings.
CICs refer to non-deposit-taking financial firms that invest their asset in equity shares, preference shares and debts or loans of their group companies. All CICs with assets exceeding 100 crore are subject to the apex bank’s regulations. JFS had applied for the same in November 2023 following the demerger of Reliance Industries’ financial services division.
RBI had mandated that the assets held by the company as a CIC in the form of investment in equity shares, bonds, debentures, preference shares, debt or loans in group companies must not be below 90%. After the transition, the company would majorly be focusing on investments, operations and the management of its subsidiaries.
This should give JFS operational flexibility to prioritise core investments over other financial services. The company has been provided with the flexibility to adapt as per the market conditions while keeping its investment portfolio diversified.
Jio Financial Services offers investment, lending, payments gateway, bank and payment aggregator services. The company debuted on BSE on August 21, 2023. On Friday’s opening session, its shares went up by 1.5% and closed at Rs 348,05 apiece.
Its net profits increased by 6% from Rs 294 crore in the December 2023 quarter to Rs 311 crore in the quarter ended March 2024 with its revenues also going up from Rs 414 crore to Rs 418 crore.
