Reliance Cap wants to enter i-banking
Reliance Capital, the non-banking finance arm of the Anil Dhirubhai Ambani Group (ADAG), is planning to foray into investment banking to broaden its offerings in the financial sector.
The company, which has presence in asset management, retail broking and insurance businesses in the country, intends to start the investment bank in partnership with a foreign player, a person familiar with the development said. He, however, declined to divulge further details.
Reliance Capital's vice-chairman Amitabh Jhunjhunwala is said to be overseeing the initiative and the company has initiated talks to rope in key executives.
A Reliance Capital spokesperson declined to comment on the development. An email query to the company did not elicit any response. According to bankers, Reliance Capital's partner for the investment bank could be a foreign firm with no presence in India till now.
Some of the names taking the rounds are the US-based Bear Stearns and Paine Webber. Investment bankers said Reliance Capital would provide the knowledge of local markets, while the foreign partner would bring in the technical expertise. The proposed launch comes at a time when there is a surge in capital raising activity in India, with several cross-border mergers and acquisitions (M&A) firming up.
However, analysts tracking Reliance Capital are unsure about the value an investment bank could bring to its balance sheet. According to an analyst: "It will depend on the size of the venture (investment bank) and how they plan to go about the business. But as per the trend, the size of the operations can be significant."
Investment bankers from rival firms said Reliance Capital can have a significant presence in the investment banking business, given the fact that it holds minority stakes in various companies across sectors. They feel Reliance Capital could secure fund-raising mandates of
these companies.
The company, which has presence in asset management, retail broking and insurance businesses in the country, intends to start the investment bank in partnership with a foreign player, a person familiar with the development said. He, however, declined to divulge further details.
Reliance Capital's vice-chairman Amitabh Jhunjhunwala is said to be overseeing the initiative and the company has initiated talks to rope in key executives.
A Reliance Capital spokesperson declined to comment on the development. An email query to the company did not elicit any response. According to bankers, Reliance Capital's partner for the investment bank could be a foreign firm with no presence in India till now.
Some of the names taking the rounds are the US-based Bear Stearns and Paine Webber. Investment bankers said Reliance Capital would provide the knowledge of local markets, while the foreign partner would bring in the technical expertise. The proposed launch comes at a time when there is a surge in capital raising activity in India, with several cross-border mergers and acquisitions (M&A) firming up.
However, analysts tracking Reliance Capital are unsure about the value an investment bank could bring to its balance sheet. According to an analyst: "It will depend on the size of the venture (investment bank) and how they plan to go about the business. But as per the trend, the size of the operations can be significant."
Investment bankers from rival firms said Reliance Capital can have a significant presence in the investment banking business, given the fact that it holds minority stakes in various companies across sectors. They feel Reliance Capital could secure fund-raising mandates of
these companies.
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