Thaindian News

New Delhi, Sep 27 (IANS) Unlocking share value through strategic sales in a host of subsidiaries such as telecom towers and life insurance businesses was the focus of Reliance Group chairman Anil Ambani’s address at back-to-back meetings Tuesday.

From hoping to soon conclude a 26-percent sale in Reliance Life for some Rs.3,000 crore to Japan’s Nippon Life Insurance and categorically stating that the deal to sell shares in the telecom towers arm is on, Ambani said the million-plus shareholders will benefit most.

The successive statements at the annual general meetings of Reliance Capital, Reliance Communications, Reliance Infrastructure and Reliance Power had a positive effect on the market sentiments, as all four stocks ended higher at the Bombay Stock Exchange.

Reliance Communications ended with a gain of 3.78 percent at Rs.80.95, Reliance Capital ended 1.32 percent higher at Rs.394.50, after rising to Rs.411, Reliance Power closed 2.44 percent at Rs.81.8 and Reliance Infrastructure ended at Rs.431.65, up 1.95 percent.

Ambani said Reliance Capital could consider a bonus issue and make an entry into the banking sector while hopes to conclude soon the 26-percent stake sale in its life insurance arm to Japan’s Nippon Life Insurance.

“Banking is a new growth opportunity. We will evaluate opportunities to enter this high growth sector and are keeping track of all regulatory developments on this front,” the group chairman told the annual general meeting of Reliance Capital here.

“Significant under-penetration of financial products and services in India will continue to create immense opportunity for our growth. We will expand our asset management group in emerging markets and grow our wealth management and private equity business.”

The financial power will be named Reliance Bank.

Relying to a question from the floor, he also said that the request of shareholders for a bonus issue will be sent to the company’s board, which can decide accordingly.

Ambani said in its first value-unlocking transaction, Reliance Capital had signed a definitive agreement with Nippon Life Insurance to sell 26 percent stake in Reliance Life Insurance earlier this year, subject to regulatory approvals.

The money from the proceeds — an estimated Rs.3,000 crore — will help in restructuring the company’s debt, the chairman added.

The company has also signed a pact with Nippon Life for collaboration opportunities and strategic partnerships in all Reliance Capital-promoted financial businesses earlier this month, he said.

In the energy business, Ambani said Reliance Power was on track to become the largest private sector electricity generator in India and was building the country’s largest wind and solar project with a collective outlay of Rs.4,000 crore.

“Our operating capacity will be 5,000 MW by 2012,” he said, referring to the group’s thermal energy projects.

Ambani also said Reliance Power has a pact with the US Exim Bank for a $5-billion loan facility and has also another with Chinese banks for $12 billion in what is the largest such support by Chinese banks to an overseas group’