Jio IPO or Reliance shares? What's better deal for future money gains if you've ₹14000 to invest — Experts suggest
Jio IPO vs Reliance shares: Amid a strong response from primary market investors to the Jio Platforms IPO, shares of Reliance Industries Ltd (RIL) saw strong buying interest on Wednesday. Reliance shares finished more than 0.50% higher at ₹1,209, while the Jio Platforms IPO was fully subscribed within an hour of opening for subscription. This might have created confusion in the mind of a retail marginal investor, who has ₹14,000 to invest, an amount that can either be used for the one lot of the Jio IPO or for buying RIL shares.
Pointing towards the difference in between the Jio Platforms and Reliance Industries, Mahesh M Ojha, VP — Research and Business Development at KC Securities, said, “After the value unlock of Jio Platforms from RIL, Reliance Industries would continue to remain the core company of the Reliance Group. So, one should have both shares in one's portfolio. However, in the case of the availability of a limited amount, I would suggest a long-term investor to go for the Reliance Industries shares, instead of applying for the Jio IPO and waiting for the allocation of shares.”
Advising the long-term investor with ₹14,000 in hand for investing in Reliance Industries shares, Avinash Gorakshkar, Founder of Avinash Mentor Research, said, “The market is expecting the benefit of value unlocking for RIL, as it holds around one-third stake in Reliance Jio Platforms. So, this rally in the RIL shares can be attributed to the Jio Platforms IPO subscription opening.”
Gorakshkar said that even after value unlock from RIL, the balance sheets of these two companies would be connected due to RIL's strong two-thirds shareholding in Jio Platforms. Good financial performance would continue to be reflected in RIL's balance sheet.
Expecting this value unlock rally to continue further, Avinash Gorakshkar said, “The market is estimating around ₹350 to ₹500 per share rise in RIL shares due to the value unlock. However, much will depend upon the kind of listing Jio Platforms IPO receives.”
“Reliance Industries' share price today is ₹1209, and it is expected to touch ₹1,550 to ₹1,700 by the end of this financial year. So, my suggestion for the investor is to go for the definite one and buy Reliance Industries shares, because in this choice, the investor won't have to wait for the share allocation,” said SEBI-registered market expert Anuj Gupta.
“One may say that an investor should go for the IPO option, and in case he or she fails to get Jio shares through the allotment process, then this open market option for the RIL shares can be exercised. But, in this scenario, the investor may have to buy RIL shares at a higher rate as RIL shares are rising on the strong response to the Jio IPO,” Gupta added.
However, stock market experts maintained that RIL shares are preferable for only those investors who have a long-term view. For a short-term investor having just ₹14,000 in hand, the Jio IPO should be his or her obvious choice as the Jio IPO listing may take place around ₹1350 to ₹1400.
Speaking on the Jio IPO listing price prediction, Avinash Gorakshkar said, “The market is expecting Jio Platforms IPO listing price in the range of ₹1350 to ₹1400, depending upon the market mood.”
So, an investor with ₹14,000 in hand and a short-term view should go for the Jio IPO, as it may increase their money by up to 25% in just one week.
As the grey market premium (GMP) is one of the major indicators of an IPO's listing price, it is important to see what Jio Platforms' GMP reflects today.
According to market observers, Jio Platforms' IPO GMP today is ₹280, ₹20 higher than yesterday's ₹260. So, the grey market is also signalling a Jio Platforms IPO listing price of around ₹1,399 ( ₹1,119 + ₹280), around 25% higher than the upper price band of the Jio Platforms IPO.
So, the grey market is also hinting at around 25% listing gain on one's money, if the Jio Platforms share is allotted to an applicant.
Asit Manohar has nearly two decades of experience in the mainstream media. In this period, he has served esteemed media organisations like NDTV Profit, The Economic Times, and Zee Business. He has been working at LiveMint Digital since April 2021. During these two decades of journey in mainstream media, Asit has mainly covered external affairs, markets and personal finance. However, his earliest beats include railways, SME, MSME, and politics (Congress beat). Some of his features on political, economic, and foreign policy are documented in the parliamentary records. <br><br> While pursuing his MA (Mass Communication, Session 2004-06), Asit began his media career as a stringer at All India Radio in Varanasi. At AIR Varanasi, Asit worked with the Gyanvani, Yuvvani and Vividh Bharti teams. After working for nearly one year at AIR Varanasi, he shifted to print journalism and started working as a stringer for the HT Media Ltd, Varanasi. At HT Media Ltd in Varanasi, he covered the BHU beat. <br><br> Asit has also worked with some brokerage houses. He has worked with Religare Broking and India Infoline, where he assisted the research team in developing and executing trade strategies for intraday cash, F&O, and commodities. <br><br> Asit is a Gold Medalist in MA (Mass Communication) from BHU, Varanasi. He did his BSc. (Hons) in Mathematics from Magadh University, Bodh Gaya. Asit was a National Talent Scholarship holder during his senior secondary studies (1988-91).
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HomeMarketsStock MarketsJio IPO or Reliance shares? What's better deal for future money gains if you've ₹14000 to invest — Experts suggest
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