With debt recast at final stages, Religare Finvest Ltd (RFL) is all set to restart its business come new year 2022, Religare Enterprises Ltd Chairperson Rashmi Saluja said.
RFL, a NBFC arm of Religare Enterprises Ltd, has been barred from undertaking fresh business as it is under corrective action plan (CAP) of the Reserve Bank of India (RBI) since January 2018, due to its weak financial health.
The company has been in financial distress due to alleged misappropriation of funds by erstwhile promoters Shivinder Singh and his brother Malvinder Singh. Multiple investigative agencies are probing the case of financial bungling of about Rs 4,000 crore.
“We will definitely start (RFL’s) business in January… this final engine will start firing beginning next year. Rs 411 has been kept aside for RFL and for the debt restructuring process and the bankers have agreed for an additional line of funding,” Saluja told PTI.
The company has put on block Rs 600 crore NPA and it is at an advanced stage, she said, adding. It is a part of debt restructuring which has been agreed by bankers and Religare Enterprises Ltd (REL). Talking about the future course of RFL, she said, stringent governance practices will be followed and a technology-led business model is being worked out.
The company has started hiring the right talent for managing the business. With regard to its standalone insurance venture, Care Health Insurance Limited (CHIL), she said, it is doing well.
Last year, homegrown private equity firm, Kedaara Capital Fund II LLP, completed the investment of Rs 567.31 crore, including primary capital infusion and purchase of 6.39 per cent stake, in erstwhile Religare Health Insurance Co Ltd. Subsequently, Religare Health Insurance rebranded itself as Care Health Insurance in August last year.
“Kedaara as a supportive partner has been giving right advice as a shareholder and board member of Care Health. Our relationship has been very smooth and we have great respect for the professional approach adopted by them in dealing with all matters” she said. Currently Kedaara holds a 17 per cent stake, while state-owned Union Bank of India has 6 per cent in the health insurance company.