Jio Financial Services gets MOFSL Buy; 36% upside

What changed for Jio Financial Services

Motilal Oswal Financial Services (MOFSL) has reiterated its positive stance on Jio Financial Services Ltd (JFS) despite what it described as a mixed set of March quarter results. The brokerage said the company’s credit-led scale-up continued, while newer businesses also ramped up. The view keeps JFS on investors’ radar at a time when the stock’s recent performance has been uneven.

In one note, MOFSL retained its ‘Buy’ rating with a target price of Rs 315, indicating about 29 percent upside potential from the prevailing levels cited in the report. Separately, MOFSL also initiated coverage on JFS with a ‘Buy’ call and a target price of Rs 320, implying roughly 36 percent upside from around Rs 236. Both sets of commentary point to the same core idea: near-term profitability may look subdued as multiple business lines are still being built, but the platform strategy is designed for scale.

MOFSL’s key numbers: valuation and profit growth

MOFSL said Jio Financial trades at about 1 times FY27 estimated book value, a valuation point it flagged while discussing the medium-term growth runway. On growth expectations, the brokerage estimated consolidated profit after tax (PAT) compounding strongly through FY28.

Across the versions of the brokerage commentary carried in the provided material, the projected pace differs slightly. One estimate cited consolidated PAT growth of 50 percent over FY26 to FY28 on a compounded annual basis. Another note modelled consolidated PAT CAGR of about 48 percent over FY26 to FY28E. In a separate market report, MOFSL also linked the lending scale-up to expectations of around 90 percent AUM CAGR and approximately 152 percent profit growth between FY26 and FY28.

Why March quarter results did not change the view

MOFSL’s stance suggests it is looking through short-term volatility in quarterly prints while tracking execution milestones across lending and new verticals. The brokerage said credit-led scale-up continued, which implies the lending engine remains central to the investment thesis. It also highlighted that newer businesses are ramping up, even if they are still early in their build-out.

The notes also indicate that profitability in the near term could remain “subdued” as several business lines are in an incubation phase. In that context, MOFSL’s valuation approach and medium-term projections are framed around the idea that the groundwork across technology, partnerships, and distribution can support scalable growth later.

What businesses are included and what is still excluded

MOFSL’s target framework referenced a sum-of-the-parts (SoTP) valuation methodology, with estimates projected to March 2028. The brokerage’s SoTP framework assigns value to business lines including Jio Credit, payments solutions, insurance broking, and the Jio-BlackRock asset management joint venture.

At the same time, the note that reiterated the Rs 315 target said the implied upside does not factor in valuation from businesses such as insurance manufacturing, wealth management, broking, and marketplace, which were described as being in an incubation phase. This distinction matters because it clarifies that MOFSL’s stated target is not attempting to fully price every potential line of business today.

How the stock traded around the reports

JFS shares saw a short-term bounce in at least one session after the initiation note. One report said the stock rose 1 percent in Wednesday’s trade after MOFSL initiated coverage with a Buy rating and a Rs 320 target. The same set of updates cited intraday levels such as Rs 239.15 on BSE and a day’s high around Rs 243, while another report cited an intraday high of Rs 242.80 on the National Stock Exchange.

On longer return periods, the provided material carried mixed one-year descriptions. One section said the stock was flat over the one-year period, while another said it had gained about 5 percent over the past one year. The reports were consistent on the weak start to 2026 in one instance, stating JFS shares were down 17 percent in 2026 so far.

Key data points at a glance

Market impact and what investors may track next

The brokerage notes frame JFS as a company attempting to build a diversified financial services ecosystem, supported by digital distribution. From a market perspective, the immediate impact was visible through the stock’s move after the initiation call and the renewed attention to valuation metrics like price-to-book.

For investors tracking the story, the key monitorables implied by the notes are the pace of lending scale-up, traction in payments and asset management initiatives, and progress across insurance-related businesses and broking. MOFSL’s comments also suggest that the timeline through FY28 is central to its modelling, which is why its valuation reference point is tied to March 2028 SoTP estimates.

Why this call matters

The combination of a Buy rating, a stated valuation of about 1x FY27 book value, and a high-growth PAT projection through FY28 forms the backbone of MOFSL’s thesis. The brokerage is effectively separating near-term earnings softness, attributed to incubation costs and ramp-ups, from the longer-term potential implied by a platform strategy.

At the same time, the notes make clear that parts of the opportunity set are not being valued yet in at least one target framework. That caveat is important when reading the upside percentages, because they are linked to what is included in the SoTP today versus what remains in the build phase.

Conclusion

MOFSL has maintained a Buy stance on Jio Financial Services, with targets of Rs 315 to Rs 320 depending on the note, and profit growth projections of roughly 48 to 50 percent CAGR through FY28. The next set of investor checkpoints will likely be continued evidence of credit-led scaling and measurable traction in the newer verticals that are still in incubation.