Reliance Capital expects its bottomline this financial year to surpass the last year’s level, Sam Ghosh, Chief Executive Officer, said.
In 2011-12, this Anil Ambani-led Reliance Group’s financial services arm had posted consolidated net profit of Rs 458 crore.
The optimism on better performance stems from anticipated improvements in market conditions for financial services businesses in the second half of this fiscal.
Gains from 26 per cent stake sale in its asset management business – Reliance Capital Asset Management (RCAM) – is also expected to bolster profits this year.
“The conditions (for financial services businesses) have actually slowed this year. But we anticipate some improvements from the third quarter onwards,” Ghosh told Business Line in an interaction post the first quarter result announcement.
For the June quarter, the company on Saturday reported a consolidated net profit of Rs 45 crore. This reflects a 30 per cent increase over the year ago period.
The second quarter performance will be better, Ghosh said.
Reliance Capital will, in the next 10-15 days, close the transaction relating to 26 per cent stake sale in RCAM to Nippon Life Insurance.
Nippon Life will invest Rs 1,450 crore to acquire the 26 per cent stake.
“This amount will get accounted for in our books in the current quarter once the transaction is closed,” he said.
In the current quarter, Reliance Capital will also get to account some of the dividend payments it would receive from its associates and other investments.
On Reliance Life Insurance, Ghosh said that it has, in the first quarter, recorded a net profit of Rs 19 crore (Rs 8 crore).
Reliance Capital has 38 per cent direct equity stake in Reliance Life Insurance.