Another big ticket IPO-less listing: Reliance Home Finance shares surge 5% to hit upper circuit on debut

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Published: September 22, 2017 10:36:21 AM

In another big ticket IPO-less listing on the bourses after Aditya Birla Capital, Reliance Home Finance Ltd made its debut on the bourses at Rs 102.10 and zoomed 5% to hit the upper circuit at Rs 107.2 on Friday morning. Reliance Home Finance, is the demerged home finance business of Reliance Capital.

reliance ibm, reliance news, reliance latest news, reliance unlimit, reliance ibm collaboration, reliance unlimit ibm collaborationReliance Home Finance Ltd, the demerged home finance unit of Reliance Capital, made its debut on the exchanges t o hit the upper circuit on listing. (Image:Reuters)

In  another big ticket IPO-less listing on the bourses after Aditya Birla Capital, Reliance Home Finance Ltd made its debut on the bourses at Rs 102.10 and zoomed 5% to hit the upper circuit at Rs 107.2 on Friday morning. Reliance Home Finance, is the demerged home finance business of Reliance Capital.

According to a statement by Reliance Capital, 49 per cent stake in Reliance Home Finance was allotted to all shareholders of Reliance Capital in the ratio of one share free of cost in Reliance Home Finance for every one share held in Reliance Capital.

The parent company will still hold 51 per cent stake in Reliance Home Finance. Edelweiss Securities believes that the move is set to unlock value for the shareholders.“Given the huge opportunities in the housing segment, we believe there is immense scope for RHF to sustain/improve growth momentum. The business is currently high growth average margins business. While cost ratios are currently taking a toll on returns, scaling business along with cost focus will help the company improve cost ratios and, consequently, improve returns profile,” the research and brokerage firm said in a note.

Reliance Home Finance had assets under management worth Rs 13,022 crore as of June 30. Home loans and affordable housing loans contributed 35 percent and 19 percent of its portfolio, respectively, while riskier segments like loan against property and construction loans accounted for 22 percent and 24 percent.

Shares of Reliance Capital fell by more than 4.5% to hit the day’s low at Rs 687.5, while the shares of Reliance Home Finance listed at the upper circuit of Rs 107.2.

The Housing Finance Company managed had Rs 13,022 crore assets under management as of June end, and is targeting Rs 50,000 crore in assets by FY-2020.  Reliance Home Finance reported a 58 per cent jump in total income at Rs 374 crore in June quarter.

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