Peerless eyes stocks after meeting CAR norm

The Peerless General Finance & Investment Company Ltd (PGFICL) has firmed up plans to invest in the capital market as it has surpassed the Reserve Bank of India's (RBI) stipulated capital adequacy ratio (CAR) of 12 per cent and the stock market is witnessing a bull run.

PGFICL is also considering the possibility of taking corporate agency and will be approaching the Insurance Regulatory and Development Authority soon.

The company is likely to invest Rs 700 crore in the stock market in the next few months, subject to the approval of the board of directors.

"We will invest the amount over a phased manner to avoid any market fluctuation," said company officials.

At present PGFICL has invested Rs 600 crore in the market, which was around 7 per cent of the company's investible surplus.

PGFICL has around 93 per cent of its investible surplus invested in instruments approved by the RBI for residuary non-banking finance companies.

According to RBI directives, the minimum amount that requires to be invested in approved investment instruments excludes stock market, at 80 per cent, leaving an excess of 13 per cent for PGFICL.

This excess amount can now be routed into the stock market. The company has around 7 per cent of its investment in scrips, debentures and other instruments.