Reliance Capital, a part of Anil Ambani led Reliance Group, informed the bourses that its board of directors on Tuesday approved the independent listing of its home finance business, Reliance Home Finance Ltd (RHF), on the stock exchanges.
The company further added that it will hold a 51 per cent stake in Reliance Home Finance and the company will be adequately capitalised to grow the lending book to over Rs 20,000 crore in the next 18 months. The proposal is subject to necessary shareholders and other approvals.
“The independent listing of Reliance Home Finance is expected to unlock substantial value for existing shareholders of Reliance Capital. The listing of Reliance Home Finance will also lead to increased management focus and accelerated growth in the home finance business,” the company said in a BSE filing.
Anmol A. Ambani, Director, Reliance Capital Ltd said, “There is presently an estimated shortage of 100 million residential units in India. To address the needs of this sector, Reliance Home Finance has charted an aggressive growth plan in this space, and aims to increase its book size to over Rs. 50,000 crore in the next few years.”
According to the proposal, 49 per cent stake in Reliance Home Finance Limited will be allotted to free of cost to nearly 1 million shareholders of Reliance Capital, in the ratio of one share free of cost in Reliance Home Finance Limited for every one share held in Reliance Capital. Anmol A. Ambani further added, “We expect the listing and allotment of shares in Reliance Home Finance, free of cost, to unlock significant value for our almost one million strong shareholder family.”
Reliance Capital had on Monday also said that the shareholders of the company have approved the transfer of its commercial finance division – Reliance Commercial Finance (RCF) – into a separate wholly owned subsidiary. The transfer was approved by majority of 99.99 per cent votes in favour of the scheme of arrangement at the court-convened general shareholders meeting held on September 10, 2016.
Shares of the company closed 5.57 per cent down at Rs 532.55 on Monday. Stock markets were closed on Tuesday on account of “Bakri Id”
Reliance Home Finance, a 100 per cent subsidiary of Reliance Capital, provides a wide range of loan solutions like home loan, LAP, Construction Finance and affordable housing loans.