Why Are Reliance Industries Shares Down After Jio Platform IPO Announcement?

Reliance Industries Ltd. in its 48th annual general meeting on Friday led by billionaire industrialist Mukesh Ambani announced that its digital and telecom arm Reliance Jio will likely get listed in the first half of 2026. However, after the announcement was made the shares of the Reliance Industries fell nearly 3%.

One of the main reasons for the decline in shares is, that through the IPO process the existing Reliance shareholders will not get any benefits. In addition to that there will be holding company discount that comes into play.

According to data compiled by NDTV Profit the holding company discount that will come into play is either 20% or 30%, which will shave off Rs 100 or Rs 150 from the actual value. So, if the Reliance Industries consensus target price is Rs 1,634 per share and Jio Platform contribution is at Rs 556, then the remaining segment value will be at Rs 1,078 apiece.

If the 20% discount gets applicable then the post IPO Jio Platform value will be at Rs 444, with the total Reliance Industries value at Rs 1,523 per share. On the other hand, if the 30% discount gets applicable then the post IPO Jio Platform value will be at Rs 389, with the total Reliance Industries share value at Rs 1,467 per share.

This indicates that it could be a negative move for the shareholder, leading to a near 3% decline in share price on Friday.

The shares of Reliance Industries fell as much as 2.59% to Rs 1,350 apiece, the lowest level since April 28. It pared losses to trade 1.38% lower at Rs 1,366.80 apiece, as of 3:09 p.m. This compares to a 0.08% decline in the NSE Nifty 50 Index.

It has fallen 10.59% in the last 12 months and risen 11.95% year-to-date. Total traded volume so far in the day stood at 1.7 times its 30-day average. The relative strength index was at 36. above 70 overbought or below 30 is over sold

Out of 37 analysts tracking the company, 34 maintain a 'buy' rating, one recommends a 'hold,' and two suggest 'sell,' according to Bloomberg data. The average 12-month consensus price target of Rs 1,634.41 implies an upside of 19.6%.