Mumbai: Shares of Reliance Capital Ltd on Tuesday surged more than 3% on the bourses after the company said it is in talks for stake sale in its general insurance arm.
Reliance Capital group has begun talks to sell 26% equity in its general insurance arm to a foreign partner, and has said it is open to selling further stake in life insurance and mutual fund units.
Reacting to the development, shares of the company opened on a bullish note and surged 3.19% to an intra-day high of Rs.387.95 on BSE.
A similar movement was seen on the National Stock Exchange as well, where the stock of the company opened at Rs.383.10 and then rose to the day’s high of Rs.387.90, higher by 3.15%.
Reliance Capital CEO Sam Ghosh has said that the group is open to the idea of selling further stake in its life insurance unit, Reliance Life, as also in mutual funds arm, Reliance Capital Asset Management Co., at an appropriate time.
Ghosh, however, did not disclose any names or potential deal size for Reliance General Insurance stake sale.
Currently, foreign investment is capped at 26% in the insurance business in India, but there are no such caps in the mutual funds segment. However, the government has proposed increasing the foreign investment limit in the insurance sector to 49%.