Speaker A
Well, so what's holding out is Mateusz Finance, one of the top gainers in the small caps space, weirdest posting good gains of about eight and a half percent. It's Heroes International Media as well, that's gaining about six and a half. The century renew cows are doing very well, four and a half percent of an uptick. BEML also doing pretty well. But to connect with the management of Religare, the company posted their numbers. Sunil Goodwani, chairman and MD, joins us on the show. Great, you have you with us now. Your board have proposed reorganization of lending, health insurance, and capital markets bills in three separate listed entities. What's the rationale for this? If you look at also your bag, Religare Enterprises basically had four large businesses: the asset management space, the lending, the health insurance, and the capital markets. Over the last year or so, we sort of re-strategized and using all of investor feedback, we got the impression that the feel that people were more wanting us to be India-focused. And we took a strategy called to refocus all the energies in India and took a call to divest from our international business of asset management. We have completed their process and today Religare is large three large business under it: the lending, the health insurance, and the capital markets. Clearly, what we do with this demerger is we unlock value, simplify structure, and create a platform for each business to get its own partners and ability to raise capital. You know, you will appreciate that a holding company model, while it was successful historically, does come on, does get out thirty to fifty percent discount in valuations. We clearly felt now it was the right time for the company this next phase of journey by simplifying the structure by demerging the entities as each entity would now be capable to attract its own set of investors. So initially when investor would come to delegate enterprises, he would get saddled if he was interested one company, he will get saddled with some other business that he was not interested in. At this point, he clearly has a choice or there the form as a choice to partner with the kind of industry or the financial services they are interested in. Why, when will the process be completed? ER than going forward and regulatory approvals in place and this in this board meeting we presented the entire proposal to the book you now to the entire board and the committee has been appointed to look into all the necessities and regulatory that I required to go ahead. The process would take around 12 to 14 months. It requires a whole, you know, the entire, you know, from SEBI to IRDA to RBI, you need regulatory bynes from everybody. But I don't think that's a challenge going ahead. If then at certain point the bankers will put together a full plan and which we will file in the scheme of arrangement with the high courts and that approval normally takes three to five months. So safely in a period of 12 to 14 months, we should be, you know, the entity should be listed. That is around about approximate period it would take. Now will there be any changes at the board level if at all? Oh, not right now. Everything remains as status quo as it is. As we go along with the entities get emerged, of course we will look at opportunity to see how we engage the board into a more meaningful manner to further govern the three entities to take them to the next level of growth. What about your cat position right now? Would any of your listed entities need capital? If so, will you arrange for that? And is there a case of a strategic investor coming into any of your businesses? See, at this point all of our businesses are very, you know, capitalized to the capacity. There is no dearth of capital in our business as of today. However, as we deem urge, what is becoming obvious is that because of the simplification of structure, we will each business, the lending business can kind of invest the investor that I interested to come an NBFC. The capital can interest, it's the capital markets can interest at all set of investors and the health insurance has a separate set of investors. So very honestly at this point we are well capitalized. However, we leave the options open to partner with new investors for growth capital as required. Okay, now in the health insurance business, Union Bank and Cooperation Bank are the other partners. Do you have any plans for another strategic investor in this business? If any of the banks plan to exist or to— The best of our knowledge, no. No bank is planning to exit. As I said earlier, we really don't require any capital in that business. However, insurance is an exciting field. We are growing. We are the number one health insurer in a growth strategy in the country today. We may keep our options open if there is an attractive valuation, a partner that can provide us the right kind of domain knowledge and help us to grow further and better. We remain open to those options, but honestly at this point we are not, you know, out there hunting for a partner. What your overall growth strategy over the course of the next one or two years in all your three businesses, lending, insurance, and capital markets? Clearly, with the demerger of Religare to three listed entities, what is emerging is an India story focused company. We are in the SME focused side on the lending side, on the SME focused business under that affordable housing. So this is a clear India story on that. We believe there's a huge ability within us and a huge opportunity within the country to tap this market. The health insurance sector is underserved. It's again an agenda for the India story and we are penetrating and we are growing very aggressively. The capital market business is a business which is cyclical but we have moved to a platform where we made it asset light and in a manner it's sort of resilient to any markets for a volatility or up and downs. At this point clearly it's with us reach of 500 offices, 500 cities, and close to 800 locations. It's a business which are the strong B2B and a B2C distribution ability. So very honestly, all three businesses put together and working as different listed entities will still collaborate and cross leverage their inherent abilities to focus on the growth on India story. Okay, thank you very much, Mr. Gidwani, for taking the time out and chatting with us, sharing your business aspect with us on Traders 20. That's the management of Religare and the stock is at the day's low as we speak. But let's continue getting those trading recommendations to you now from Mandar Jimson. They occur as well as had been the Shahboz. Oh, good morning to both of you. Mandar first to you and if you can tell us which stocks are you betting on? Yeah, good morning. Come here. The first talk that I have is Cool India. For the last two months, the stock has been consolidating in a narrow range.
