Reliance Capital has the following businesses.
- Reliance Nippon Assset Management - separately listed. Company holds 42% - Business doing fairly well.
- Reliance Home Finance - separately listed. Company holds 47% - Doing very well.
- Reliance General Insurance - held with Nippon. Will be listed/demerged in the future - Doing very well.
- Reliance Life Insurance - held with Nippon. Will be listed/demerged in the future
- Reliance Securities - brokerage business
- Reliance Money - rebranded from Reliance Commercial Finance. Has more tham 16000 cr loan book
- Investments in companies - like Yatra, paytm, Prime Focus, etc. This is about 14000 cr and is being liquidated.
For 1 to 4, it will have holding company discount. 5 is a small biz. 6 is a business which will grow very well, as Devang Mody is heading it (ex- Bajaj Finance).
Market cap is about 12000 cr. One can do a SOTP of all these businesses.
2 big overhangs behind it. First is RCom issue. 2nd is 2G trial.
It’s at a significant discount to book value of about 640 Rs. Has got good earnings and pays good dividend.
There will be some negatives in the stock. But for me, that’s a risk I am willing to take as it’s priced dis-proportionately.
My views can be considered biased, as it’s my largest position.