 "Reliance Capital Q4 net flat")
The earnings growth appeared muted as the company did not include its life insurance business' profit for the first half of 2013-14 in the fourth quarter numbers, something it did in the corresponding period of the previous year.
"This year the life insurance business' profit has been added to our consolidated numbers in two tranches. So, the January-March consolidated figures include life insurance business' profit for the third and fourth quarter only, and not the first two quarters," Sam Ghosh, chief executive officer of Reliance Capital, told Business Standard.
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If this is adjusted, Reliance Capital's fourth quarter consolidated profit after tax increased by 40 per cent, on a year-on-year basis. Ghosh said performance of the company's asset management and commercial finance businesses aided the overall earnings growth.
Total income was up nine per cent from a year earlier at Rs 1,848 crore during the January-March period. The company's net worth was estimated at Rs 12,483 crore at the end of March, 2014. Total assets grew by 12 per cent from a year ago to Rs 45,528 crore.
Reliance Capital's consolidated net profit for financial year 2013-14 was at Rs 747 crore.
Among the group companies, Reliance Life Insurance reported a profit of Rs 359 crore for the year ended March 31, 2014. The declared results of Reliance Capital include consolidation of 48 per cent stake in the life insurance venture. The general insurance business earned a profit of Rs 64 crore during the year.
The profit before tax of the commercial finance venture increased by 26 per cent to Rs 430 crore, while that of the asset management business grew by 22 per cent to Rs 352 crore.
BANKING PLANS
Ghosh said Reliance Capital will wait for fresh guidelines from the Reserve Bank of India (RBI) before re-applying for a new banking licence. The company was one of the 25 players that had applied for a new banking but only Bandhan and IDFC were permitted to set up banks.
On whether Reliance Capital will be willing to opt for a differentiated banking licence, Ghosh said: "Our chairman had indicated that we will prefer a full banking licence. We will wait for the new guidelines before taking any decision."
He added that the company did not make fresh recruitments for its proposed banking foray. "Our in-house team was helping us to prepare for the banking foray. So, to that extent, we hardly had any impact (on not getting a banking licence)," Ghosh said.