Reliance Capital to invest Rs 2,000 cr in insurance biz...

Reliance Capital, part of the Reliance ADAG group, would invest up to Rs 2,000 crore over the next three to five years in its insurance business, and also enter the banking, home loans and consumer finance businesses, Mr Anil Ambani, Chairman, told shareholders at the company’s AGM here on Tuesday.

The investment of Rs 2,000 crore would take the group’s cumulative investments to over Rs 4,000 crore,” he said. “We’re also in the process of re-pricing the risks involved in some areas of general insurance where we have experienced higher expenses and claims,” he added.

He also said the group would foray into banking upon receiving the necessary regulatory permits.

The company would also venture into the home loans business and establish a non-banking financial company for its consumer finance business. “We have already filed the applications with the regulators concerned in this respect and are awaiting approval,” Mr Ambani said.

The company is also looking at expanding into the businesses of liability insurance, hull and marine insurance. Talking about the group’s asset management company, he said it has received regulatory approval to set up AMC operations in the UK and is also considering launching new funds in the South East Asian markets. “We’ll expand our asset management, life insurance and broking operations in the emerging markets across Asia, Africa and West Asia,” Mr Ambani said.

Mr Ambani said the company would go ahead with its plans, notwithstanding the global financial crisis following the financial trouble at Lehman, Merrill Lynch and AIG. The top ten shareholders in Reliance Capital include Morgan Stanley Mauritius, JP Morgan Asset management (Europe), Goldman Sachs Investments (Mauritius), Merrill Lynch Capital Markets Espana and Deutsche Securities Mauritius. “The company does not have direct exposure to these companies, so in that case we are immune and insulated from the problems happening there,” he said.

The company also announced a dividend of 55 per cent for fiscal 2007-2008. The share price of the company was up 2.35 per cent at Rs 1,107.45 on the BSE today.

Source: Business Line