Reliance Capital To List Home Finance Business By May
Reliance Capital reported a 11 percent drop in net profits
Reliance Capital Ltd.’s October to December quarter profit dropped 11.2 percent after the financial services firm made provisions to bolster its general insurance business.
The firm set aside Rs 43 crore for strengthening the reserves of Reliance General Insurance, the Anil Ambani group company said in its filing to the exchanges. Excluding this amount, profit rose 8 percent to Rs 252 crore.
Total income jumped 68 percent to Rs 3,964 crore from Rs 2,353 crore in the corresponding quarter last year. While assets of the home finance segment grew 40 percent to Rs 9,656 crore, those of the commercial finance business grew 8 percent to Rs 16,191 crore.
The profit would have been better had demonetisation not happened, Sam Ghosh, the executive director and group chief executive officer of Reliance Capital told BloombergQuint in an interview.
Disbursements fell in the month of November and partially in December which had an impact. Despite all of that, the assets under management have grown. Otherwise, we could have seen a significantly higher growth in the AUMs (assets under management).Sam Ghosh, ED And Group CEO, Reliance Capital
The company plans to de-merge its commercial finance business by March 31, 2017 and list its home finance business by April-May.
This year we may not see a stake sale because in the general insurance side, we are looking at what we can do there. With about 25-30 players in the market, there is opportunity for amalgamation. Similarly on the life insurance side, though we have Nippon life as a partner, we will look at opportunities for amalgamation there as well. We will be looking for a banking partner for the life insurance business.Sam Ghosh, ED And Group CEO, Reliance Capital
Reliance Capital stock fell 3.1 percent to Rs 477.8 on Monday.