Jio Financial Services to trade as part of Nifty 50, Sensex for 3 days starting July 20

Jio Financial services will trade as part of Nifty50 and Sensex for 3 days starting July 20. This is a standard procedure for spinoffs. Reliance Industries has demerged its financial services arm, which will be renamed and listed as Jio Financial Services on 20th July.

The National Stock Exchange has said that the demerged entity will also be included in the Nifty 100, Nifty 200 and Nifty 500 indices along with other sectoral indices. In a different notification the NSE has also said that a pre-open auction call session for the Reliance Industries will be conducted for price discovery on July 20 from 9–10 a.m.

"All the unmatched orders of the pre-open call auction session within the dynamic price band of the discovered price shall be moved to the normal trading session at their limit price", the circular read.

Also Read: Reliance Industries shares jump after financial services arm's demerger date fixed

Pre-open auction call is conducted to fix an ideal opening price of a stock for the current trading session. However, if the equilibrium price is not discovered, all orders will be cancelled and the stock will continue to trade in the call auction mechanism until equilibrium price is discovered.

Once the price is fixed, the stock will be eligible to trade from the second session of the block deal window on that day's trading session. Block deal trade is always conducted in a special trading window which is opened for a period of 35 minutes before the start of the normal trading hours.

The Bombay Stock Exchange will also add Jio Financial services to 18 of the S&P BSE indices including Sensex starting from July 20 for three days. After 3 days, it will be dropped from all the indices at the last traded price.

Jio Financial Services will be included in the indices at a constant price. The constant price is the difference between the the demerged company's closing price a day before the ex-merger date and the price derived during the Special Pre-Open session on the ex-merger date.