Reliance Capital: Financial Powerhouse
Reliance Capital has an expansive and wide range of growing businesses that impact the financial lives of several million people. Its asset management business helps investors reach their financial goals, it finances dream homes, insures lives, manages wealth and undertakes broking, making it a true financial services conglomerate. Little wonder, it has ranked high among the ‘most respected companies’ in India and has topped the NBFC setor.
Starting off as a financing firm 23 years ago, Reliance Capital has added more verticals to its roster of business touching many aspects of commercial and personal finance. And, over the years, Reliance Capital has carved a name for itself in the financial services and has become the fourth largest private financial group in net worth.
If you look at the mutual funds business, Reliance Mutual Fund is among the top 3 mutual funds in the country in assets under management with a share of 12 per cent as on March 2016. In its life insurance segment, it has 35 products, of which 26 are for individuals. Reliance Nippon Life Insurance has a market share of 4 per cent in new business premium.
Reliance Capital is also helping customers find their dream homes and financing them through its subsidiary, Reliance Home Finance (RHF). Due to a boom in housing requirements and a wide range of products such as home and construction financing, loan against property and so on, RHF has done disbursements worth Rs 3,922 crore in FY16, as compared to Rs 3,475 crore in FY15, a rise of 13 per cent.
When it comes to providing loans for SMEs, Reliance Commercial Finance (RCF) provides these loans focusing on asset-backed lending and productive asset creation. RCF is now only providing secured asset backed loans, and has wound up the unbacked portfolio.
Last year, RCF saw disbursements to the tune of Rs 8,138 (FY16) crore as against Rs 6,967 crore for the previous year, that is, FY15, an increase of 17 per cent. The businesses assets under management grew by 7 per cent to Rs 15,157 crore, spread across 55,600 customers across 44 cities.
Reliance Capital’s securities subsidiary Reliance Securities deals with equities, commodities and even has a product bouquet of wealth management services. As on 16 March, the business had about 7.75 lakh of broking accounts. Besides, there has been an interest in wealth management services lately, and here the businesses assets under management surged 87 per cent to Rs 2,552 crore in FY16.
Reliance General Insurance (RGI), another subsidiary, offers insurance solutions for auto, health, home, travel, and so on having a market share of 0.7 per cent. RGI had a distribution network of 125 branches and 20,500 agents as on March 2016.
“Reliance Capital made significant progress during the year towards improving operational performance across its core businesses and is fully geared to capitalise on its growth aspirations,” said Chairman Ambani in the 2016 annual report.
With the new growth plan that envisages winding down a major part of the non-core businesses by FY18, Reliance Capital will help free up capital and allocate it to the growth areas that need it the most. Further, the company has drawn plans to increase customer base from 20 million to 50 million and increase distribution reach from 5,000 to 25,000 cities and towns, and increase the number of business partners from half to one million.
If all goes well, the financial services conglomerate will scale new heights. Just wait for another two years.
