The board of Reliance Capital, part of the Anil Ambani-led group, on Tuesday approved a proposal to independently list its home finance business on the stock exchanges.
The independent listing of Reliance Home Finance is expected to unlock substantial value for existing shareholders of Reliance Capital, the company said in a statement.
"The listing of Reliance Home Finance will also lead to increased management focus and accelerated growth in the home finance business," it added.
"To address the needs of this sector, Reliance Home Finance has charted an aggressive growth plan in this space, and aims to increase its book size to over Rs.50,000 crore in the next few years," said Anmol A. Ambani, Director, Reliance Capital.
"Prime Minister Narendra Modi has set a goal of affordable housing for all by 2022. There is presently an estimated shortage of 100 million residential units in India," he said.
"We expect the listing and allotment of shares in Reliance Home Finance, free of cost, to unlock significant value for our almost one million strong shareholder family."
According to the proposal, 49 per cent stake in Reliance Home Finance will be allotted to all shareholders of Reliance Capital, in the ratio of one share free of cost in Reliance Home Finance for every one share held in Reliance Capital.
Reliance Capital will hold a 51 per cent stake in Reliance Home Finance, and the company will be adequately capitalised to grow the lending book to over Rs 20,000 crore in the next 18 months.
The proposal is subject to necessary shareholders' and other approvals.
Reliance Home Finance, a 100 per cent subsidiary of Reliance Capital, provides a wide range of loan solutions in housing and related construction.
The company reported an annual asset base under management of Rs 8,259 crore ($1.2 billion) during the quarter ended June 30, 2016.
--IANS
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