Hinduja Group firm IndusInd International Holdings (IIHL) expects the valuation of its banking, financial services and insurance (BFSI) business to nearly triple to $50 billion by 2030, according to chairman Ashok P Hinduja.
The group is looking to raise its stake in IndusInd Bank to 26% in tranches from15% at present, while a consortium of lenders has offered to fund the takeover of debt-laden Reliance Capital (RCap).
IIHL’s BFSI business, which includes IndusInd Bank and Invesco Mutual Fund, would grow from about $17 billion at present to $30 billion in three years and then to $50 billion by 2030, Hinduja said. The major share would come from the bank and RCap following the conclusion of the bankruptcy process.
“Our master plan for BFSI is in the making. Our team at IIHL is working with outside consultants to come up with a plan to grow the BFSI business… Importance will be given to get value and move fast to create digitisation. The more you get into technology the more the valuation will rise,” he said.
He said the valuation of IndisInd Bank is expected be $30-35 billion by 2030.
Further, IIHL will look to acquire small banks in European countries such as Switzerland, Liechtenstein, Germany and Luxembourg. Due diligence processes are on, he said, without divulging further details.
On hiking the stake in Indusind Bank to 26%, he said the firm’s board had cleared the proposal and is awaiting regulatory approvals. “I am hoping that maybe in a week or two weeks we should get their response. Once we get that, we’ll start the process of raising the capital through the bank or from the market,” he added.
The group is also looking to list the Mauritius-based IIHL on the Afrinex exchange in the island nation to “create shareholder value”, Hinduja said, adding that IIHL has over 600 high net worth shareholders.
IIHL had invested in Afrinex, Singapore-based wealth management firm Beryllus Capital, and also holds a controlling stake in Sterling Bank & Trust, Bahamas. IIHL is also a promoter of IndusInd Bank.
Hinduja, however, did not provide any time frame for the listing.
Hinduja said the company has received all approvals for the takeover of RCap, except from insurance regulator Irdai, which is expected soon. Following the acquisition, RCap will continue to be the holding company for all its businesses.
On the case filed by Gujarat’s Torrent Group in the Supreme Court alleging that the second e-auction for RCap was illegal, Hinduja said the court has to take a decision. The apex court has not stayed the resolution process.
IIHL has tied up Rs 9,661 crore needed for the deal, of which 25% would be equity that would come from a subsidiary while the remaining will be debt. A consortium of banks has given a letter stating they will provide the funds within 48 hours of all Irdai approvals.
If Irdai’s approvals do not come in by the May 27 deadline set by the National Company Law Tribunal, IIHL will seek an extension to complete the resolution process. At present, RCap has some realty business, which would be sold off, he said.
On renaming of Rcap firms, IIHL has three years as per the resolution plan to change the name, and the management of the companies will take call on it.
“Our general proposal to lenders of RCap and NCLT was we will not look at past liabilities — litigations, liabilities and financials — and that was accepted by the CoC and others,” he said, adding Nippon Life will continue as a partner with 49% stake in Reliance Nippon Life Company.
Hinduja also said government policies were “proactive”, but investment-friendly policies for overseas Indians were missing. These would result in more high networth Indians investing into the country, he added.
