Jio Financial Services Limited

Financial Services — Asset Management · NSE

₹216.25−₹2.76 (−1.26%)

DalalBaazaar Score

70 / 100

🟢 Good

Verdict

NEUTRAL

Risk

Moderate

Driven by negative free cash flow, a very high earnings multiple, which leaves little margin for disappointment, falling profits.

In simple words: The business is earning a fairly low return on the money invested in it, though profits are falling even as sales grow. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:07 pm

Caution warranted. Multiple fundamental metrics — flagged in red below — point to either valuation stretch, leverage risk, or weakening profitability. This doesn't mean avoid the stock outright, but it does mean the burden of proof is on the growth story to justify the current price.

Understanding the Business

Company site ↗

The 60-second version of Jio Financial Services Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Jio Financial Services Limited, through its subsidiaries, engages in the business of investing and financing, insurance broking, payment bank and payment aggregator, and payment gateway services in India.

IndustryAsset Management

SectorFinancial Services

Employees2,000

Annual revenue₹3,185 Cr

How does it make money?

Turns over ₹3,185 Cr a year. Of every ₹100 of sales, about ₹49 reaches shareholders as profit, with ₹86 left at the operating level before interest, tax and depreciation. Each of its 2,000 employees supports ₹1.59 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin85.5%

Net margin49.0%

Revenue / employee₹1.59 Cr

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC BANK LTD, ICICI BANK LTD., STATE BANK OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

BAJAJ FINANCE LIMITEDP/E 30.2x · ROE 17.8%

HDFC BANK LTDP/E 15.9x · ROE 13.8%

ICICI BANK LTD.P/E 18.1x · ROE 16.5%

STATE BANK OF INDIAP/E 10.3x · ROE 15.2%

What is its competitive advantage?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

ROCE1.7%

ROE1.3%

Peer median ROE16.5%

What is the outlook?

3 analysts covering the stock expect revenue to grow about 21.7% and earnings to grow about 49.3% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+21.7%

Est. earnings growth+49.3%

Analysts3

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +14932% while net margin moved -67% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+14932%

Margin effect-67%

DalalBaazaar Score

70/ 100

Good

Weighted across six categories. Every point is explained below.

✓ Beta of 0.52 — historically steadier than the index
✓ Large-cap: deep liquidity and broad analyst coverage
✗ Profits have swung sharply from year to year — earnings are hard to forecast
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

73/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

54/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

82.2x

3Y Median

120.8x

40 monthly readings · mean 1837.1x · range 82.1x–7664.6x

Sector Median

17.0x

median of 4 sector peers

🟢Current valuation is approximately 32% below its 3y median of 120.8x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 384% above the peer median of 17.0x.

vs. its own history

Cheap

120.8x median over 40 months · -32%

vs. sector peers

Expensive

17.0x median of 4 peers · +384%

vs. generic bands

Expensive

Above 35x

P/E (Trailing)

82.2x

P/B

1.11x

EV/EBITDA

60.2x

PEG

0.31

Dividend Yield

0.28%

What's Good / What's Bad

🟢 What's Going Well2

Valuation below its historical average
At 82.2x the stock trades 32% below its own median of 120.8x.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Margins are compressing
EBITDA margin has slipped from 232.8% to 85.5% over 3 years.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Significant margin compressionFinancial
EBITDA margin has fallen 147.3 points, from 232.8% to 85.5%.
🟡Interest coverage is deterioratingFinancial
Cover has fallen from 255.5x to 3.6x.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 32% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Margins are being competed away
EBITDA margin has fallen from 232.8% to 85.5%. If the trend continues, profit falls even on flat sales — and margin decline rarely reverses quickly.
A premium to the sector to defend
It trades 384% above the peer median. That premium needs a reason that persists, or it closes.
Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 324% a year✓ 431.7% CAGR
Latest reported year was 26.7%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2EBITDA margin holds above 84%✓ 85.5%
Two points below today's level — enough room for noise, tight enough to catch real compression.
3Return on equity stays above 8%✗ 1.3%
For a lender this is the cleanest single read on whether the book is being grown profitably.
4Interest cover stays above 3x✓ 3.6x
How much operating profit can fall before interest stops being comfortably covered.
5Valuation vs its own median of 120.8x✓ 82.2x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

6 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✗ Profit growing year-over-year
✗ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 1 neutral · 5 weak

Market Cap

₹1.43 L Cr

Large Cap

Large, widely-covered business — typically the steadiest of the bands

P/E (Trailing)

82.2x

Expensive

Expensive — verify against sector peers

P/B Ratio

1.11x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹2.63

Profitable

Profitable on a per-share basis

ROE

1.3%

Weak

Weak capital efficiency

ROCE

1.7%

Weak

Low return on total capital employed

Debt/Equity

0.32x

Low

Conservative leverage

Revenue Growth (YoY)

26.7%

Healthy

Healthy top-line growth

Profit Growth (YoY)

-53.6%

Falling

Profits are shrinking

Dividend Yield

0.28%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹15,544 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

CMP

₹216.25

P/E (Forward)

46.7x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

ROA

1.0%

Weak

Assets generate little profit

Operating Margin

49.3%

Good

Healthy core-business profitability

Net Margin

42.8%

Good

Strong bottom-line conversion

Current Ratio

113.49

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.52

Defensive

Steadier than the market

52W Range Position

Near low

Near its 52-week low

Technical Snapshot

SMA 20 / SMA 50

220.1 / 233.0

Bearish alignment (short < long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

36.9

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹21 Cr	₹1,171 Cr	₹1,347 Cr	₹3,185 Cr	+431.7%
EBITDA	₹49 Cr	₹1,990 Cr	₹2,017 Cr	₹2,724 Cr	+280.8%
EBITDA Margin	232.8%	170.0%	149.7%	85.5%	—
PAT (Net Profit)	₹31 Cr	₹1,605 Cr	₹1,613 Cr	₹1,561 Cr	+268.3%
EPS	₹0.05	₹2.53	₹2.54	₹2.46	+268.4%
ROE	0.0%	1.2%	1.3%	1.2%	—
ROCE	0.0%	1.4%	1.5%	1.7%	—
Total Debt	₹743 Cr	—	₹3,970 Cr	₹21,768 Cr	+208.3%
Free Cash Flow	₹2,055 Cr	-₹678 Cr	-₹10,131 Cr	-₹15,544 Cr	—

🟢 Revenue has grown at 431.7% a year over 3 years.

🟢 EBITDA has grown at 280.8% a year over 3 years.

🔴 EBITDA Margin has fallen from 232.8% to 85.5% over 3 years (-147.3 pts).

🟢 PAT (Net Profit) has grown at 268.3% a year over 3 years.

🟢 EPS has grown at 268.4% a year over 3 years.

🟢 ROE has risen from 0.0% to 1.2% over 3 years (+1.1 pts).

🟢 ROCE has risen from 0.0% to 1.7% over 3 years (+1.7 pts).

🔴 Total Debt has grown at 208.3% a year over 3 years.

🔴 Free Cash Flow has turned negative, from ₹2,055 Cr to -₹15,544 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹1.63 L Cr

Total Liabilities

₹29,643 Cr

Total Debt

₹21,768 Cr

Cash & Equivalents

₹665 Cr

Operating Cash Flow

-₹15,439 Cr

Capex

-₹105 Cr

Shareholding (proxy)

Institutional Holding

19.5%

Insider Holding

50.2%

Corporate Actions

Dividend Rate

₹0.6

Ex-Dividend Date

10 Aug 2026

Analyst Consensus

Recommendations

3 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹290.33

+34.3% vs CMP

Target Range

₹273 – ₹300

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC BANK LTD	15.9x	13.8%
ICICI BANK LTD.	18.1x	16.5%
STATE BANK OF INDIA	10.3x	15.2%

Recent News

4 mixed1 negative1 general

Jio Financial Services Q2 Results: PAT drops 51% YoY to Rs 340 crore; NII soars 165%

The Economic Times, 15 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Jio Financial Services Q2 FY27 net profit declines 51% as total expenses jump to ₹1,166 crore YoY

Upstox, 15 OctResults

🔴Potentially negativeReported deterioration, which feeds the growth and margin inputs on this page directly.

Jio IPO: How Rs1,000 invested in Reliance in 1977 grew to over Rs 50 lakh

Firstpost, 15 Oct

India's Jio Financial posts drop in quarterly profit

marketscreener.com, 15 OctResults

🟡Mixed / dependsA results event. The figures on this page update once the new statements reach the data feed, which usually lags the announcement.

Jio Financial shares drop 2.5% as Q2 PAT halves; MOFSL cuts FY27 estimates

Business Standard, 16 OctPrice move

🟡Mixed / dependsA price move rather than a change in the business. If the figures on this page have not moved, the fall is either an opportunity or news they have yet to catch up with.

Jio Financial Services Shares Surge Over 3.5% Today After Blockbuster Q1 FY27 Results; Should You BUY or SELL?

Goodreturns, 14 OctPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

Watch Items

Trading very close to its 52-week low — worth checking whether this reflects a temporary setback or a structural problem.
This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

🟢Business QualityStrong15.9/20

🟢Financial HealthStrong17/20

🟡GrowthModest12.9/20

🟡ProfitabilityModerate8.9/15

🟡ValuationFair9.7/15

🟡RiskModerate5.7/10

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

This thesis breaks if

✓Revenue growth stays above 324% a year431.7% CAGR
✓EBITDA margin holds above 84%85.5%
✗Return on equity stays above 8%1.3%
✓Interest cover stays above 3x3.6x
✓Valuation vs its own median of 120.8x82.2x today