Religare eyes to become a full-fledged bank: Chairperson

Religare Enterprises Ltd (REL) will aim to become a full-fledged bank in the coming years even as Dabur Promoter Burman family is looking to gain management control of this financial services holding company, its Executive Chairperson Rashmi Saluja said on Tuesday.

Noting that it was “business as usual” for REL despite the open offer from Burman family, Saluja, who has spearheaded REL’s resurgence in the last five years, said that the company would in the next three-five years look to become the “go-to” 360-degree financial services provider for Indian masses, with special focus on tier-3 and -4 towns.

Religare Finvest Limited (RFL), a REL subsidiary that successfully completed its one-time settlement with 16 lenders in March this year, will resume operations in next 1-2 months, Saluja told businessline here in an interview. 

“We have fulfilled the requirement of Prompt Corrective Action (PCA) removal. All the inspections (from RBI) are over. Now we are hopeful of resuming operations in 1-2 months”, she said. RFL was brought under RBI’s PCA framework on January 1, 2018.

Going forward, RFL will focus on lending to micro and small units, where there is still lot of potential to grow given the unmet credit needs of this segment, she said.

On the REL plans to become a bank, Saluja said REL is aiming to become a full-fledged bank and not looking at converting itself into a Small Finance Bank (SFB). It is very difficult to convert from a SFB to full fledged bank, she noted.

“I would like to become a full bank. Today, I am trying to prove my credibility to that level that RBI accepts me as a bank. I am very happily trying to show my aspirations on that. It is aspiration for me and real ambition for the organisation (REL)”, Saluja said.

This was Saluja’s first interview after Burman Family on September 23 bought an additional 5.27 per cent stake in REL for ₹ 407 crore, triggering a mandatory open offer to purchase an additional 26 per cent stake from the public.

Burman family has specified the open offer price at ₹ 235 per share, a 15 percent discount to then prevailing share price of ₹275 at the bourses.

Asked if the five independent directors have provided their written recommendation regarding the Burman family’s open offer price, Saluja said “it was work in progress. Their report is expected to be ready in two weeks”. The tendering process in open offer can commence only after independent directors’ submit their report.

Saluja declined to be drawn into the market speculation that the REL Board contends that the company was worth more than what the Burman family has offered.

Noting that the Burman family has so far not discussed with the REL about their vision or plans for the company post takeover, Saluja said current management is fully committed to treat all the shareholders equally with utmost respect. Till the Burmans become Promoters, they are shareholders of REL, she said. REL Board and management will do whatever is best for the organisation, Saluja said.

“We are in the process of unlocking value. I would like value to be unlocked in a way that maximises the strength of all stakeholders keeping in mind the interests of all 54,000 plus shareholders”, she said.

Currently, REL operates without a designated (identifiable) promoter and is run by professionals.

REL through its subsidiaries is into four lines of businesses— affordable housing, health insurance, lending and stock broking.

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