Life Insurance Corp.
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Hefty upfront payouts have fueled policy churn and unsuitable sales, sources say
New model may tie pay to selling effort and after-sales services
India is one of Asia's biggest insurance markets but penetration remains low
By Ashwin Manikandan
MUMBAI, July 3 (Reuters) - India's insurance regulator is seeking to reform how distributors are paid in an effort to rein in mis-selling, and plans to propose commissions be paid out over the life of a policy instead of in large upfront payments, two sources said.
The revamp is part of a broad review by the Insurance Regulatory and Development Authority of India (IRDAI) and also aims to reduce high distribution costs in one of the world's fastest-growing insurance markets, according to the sources who have knowledge of the discussions between the regulator and the industry.
"A draft framework is imminent and could be circulated within the next four to six weeks," said one of the sources, who declined to be identified as the talks were private.
Staggering commission payments would bring India in line with major global markets such as the U.S., the UK and Europe.
The planned proposal to move from large upfront payments in favour of paying out commissions over the life of a policy has not been previously reported.
IRDAI did not immediately respond to a request for comment.
The regulator's chair, Ajay Seth, said last week that it was working on a distribution reform consultation paper that could be issued by the end of July.
A SECTOR RIPE FOR REFORM
Indian authorities have been keen to reform the country's insurance industry.
There have been concerns that hefty upfront commissions encourage distributors to prioritise sales volumes over customer suitability, resulting in mis-selling and customers being pushed into purchasing policies frequently.
Distributors can earn commissions of up to 40% of premiums on some life and health insurance products, industry executives say, with a significant portion of that gained upfront.
India is one of Asia's largest markets with gross premium collections exceeding 11.9 trillion rupees ($125 billion) annually. But insurance penetration — measured by the total amount of insurance premiums underwritten in a year — was just 3.7% of GDP in 2024. That compares with an Allianz estimate of 7.2% for the global average.
The government last year cut the tax levied on individual health and life insurance premiums to 0% from 18% to make policies more affordable. It also opened up the sector to 100% foreign direct investment, leading to a further pick-up in interest from overseas companies.
NEW PRICING MODEL FLOATED
The regulator is also considering linking commissions to a pricing model that factors in the effort involved in selling and servicing a policy, the sources said. The current system largely relies on a fixed commission agreed between an insurer and a distributor.
The model under consideration could reward agents helping customers with face-to-face advisory services, filling out paperwork and managing claims with a higher commission fee than, say, a bank selling policies to customers as an add-on product.
Commissions could also be capped depending on the product, the policy length and complexity, the sources said.
Disclosure requirements for agents, brokers and other distributors are also likely to be tightened, bringing greater transparency to commission and remuneration structures, the sources said.
India has more than 60 insurers. Major domestic life insurers include state-owned Life Insurance Corp of India LIFI.NS, ICICI Prudential ICIR.NS and HDFC Life HDFL.NS, while ICICI Lombard ICIL.NS and Bajaj General Insurance are among the top non-life players.
Foreign firms include Prudential PRU.L, Sun Life Financial SLF.TO and AIG AIG.N.
($1 = 95.3900 Indian rupees)
(Reporting by Ashwin Manikandan; Editing by Ira Dugal and Edwina Gibbs)
(([email protected];))
Hefty upfront payouts have fueled policy churn and unsuitable sales, sources say
New model may tie pay to selling effort and after-sales services
India is one of Asia's biggest insurance markets but penetration remains low
By Ashwin Manikandan
MUMBAI, July 3 (Reuters) - India's insurance regulator is seeking to reform how distributors are paid in an effort to rein in mis-selling, and plans to propose commissions be paid out over the life of a policy instead of in large upfront payments, two sources said.
The revamp is part of a broad review by the Insurance Regulatory and Development Authority of India (IRDAI) and also aims to reduce high distribution costs in one of the world's fastest-growing insurance markets, according to the sources who have knowledge of the discussions between the regulator and the industry.
"A draft framework is imminent and could be circulated within the next four to six weeks," said one of the sources, who declined to be identified as the talks were private.
Staggering commission payments would bring India in line with major global markets such as the U.S., the UK and Europe.
The planned proposal to move from large upfront payments in favour of paying out commissions over the life of a policy has not been previously reported.
IRDAI did not immediately respond to a request for comment.
The regulator's chair, Ajay Seth, said last week that it was working on a distribution reform consultation paper that could be issued by the end of July.
A SECTOR RIPE FOR REFORM
Indian authorities have been keen to reform the country's insurance industry.
There have been concerns that hefty upfront commissions encourage distributors to prioritise sales volumes over customer suitability, resulting in mis-selling and customers being pushed into purchasing policies frequently.
Distributors can earn commissions of up to 40% of premiums on some life and health insurance products, industry executives say, with a significant portion of that gained upfront.
India is one of Asia's largest markets with gross premium collections exceeding 11.9 trillion rupees ($125 billion) annually. But insurance penetration — measured by the total amount of insurance premiums underwritten in a year — was just 3.7% of GDP in 2024. That compares with an Allianz estimate of 7.2% for the global average.
The government last year cut the tax levied on individual health and life insurance premiums to 0% from 18% to make policies more affordable. It also opened up the sector to 100% foreign direct investment, leading to a further pick-up in interest from overseas companies.
NEW PRICING MODEL FLOATED
The regulator is also considering linking commissions to a pricing model that factors in the effort involved in selling and servicing a policy, the sources said. The current system largely relies on a fixed commission agreed between an insurer and a distributor.
The model under consideration could reward agents helping customers with face-to-face advisory services, filling out paperwork and managing claims with a higher commission fee than, say, a bank selling policies to customers as an add-on product.
Commissions could also be capped depending on the product, the policy length and complexity, the sources said.
Disclosure requirements for agents, brokers and other distributors are also likely to be tightened, bringing greater transparency to commission and remuneration structures, the sources said.
India has more than 60 insurers. Major domestic life insurers include state-owned Life Insurance Corp of India LIFI.NS, ICICI Prudential ICIR.NS and HDFC Life HDFL.NS, while ICICI Lombard ICIL.NS and Bajaj General Insurance are among the top non-life players.
Foreign firms include Prudential PRU.L, Sun Life Financial SLF.TO and AIG AIG.N.
($1 = 95.3900 Indian rupees)
(Reporting by Ashwin Manikandan; Editing by Ira Dugal and Edwina Gibbs)
(([email protected];))
Life Insurance Corporation of India's Chief Financial Officer Sunil Agrawal resigned on June 24, 2026, to pursue better prospects. His resignation will be effective from the close of business on July 14, 2026, when he will cease to be CFO and Key Managerial Personnel. Agrawal submitted his resignation letter to the CEO and Managing Director, expressing gratitude for the opportunities during his tenure.
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Life Insurance Corporation of India's Chief Financial Officer Sunil Agrawal resigned on June 24, 2026, to pursue better prospects. His resignation will be effective from the close of business on July 14, 2026, when he will cease to be CFO and Key Managerial Personnel. Agrawal submitted his resignation letter to the CEO and Managing Director, expressing gratitude for the opportunities during his tenure.
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June 24 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - SUNIL AGRAWAL RESIGNS AS CFO OF LIFE INSURANCE CORPORATION OF INDIA EFFECTIVE JULY 14, 2026
Source text: ID:nBSE74cYzJ
Further company coverage: LIFI.NS
(([email protected];))
June 24 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - SUNIL AGRAWAL RESIGNS AS CFO OF LIFE INSURANCE CORPORATION OF INDIA EFFECTIVE JULY 14, 2026
Source text: ID:nBSE74cYzJ
Further company coverage: LIFI.NS
(([email protected];))
Adds details throughout on Jio Platforms
MUMBAI, June 19 (Reuters) - Indian billionaire Mukesh Ambani's Reliance Jio Platforms filed regulatory papers for an IPO on Friday that sources said would raise about $3.8 billion, making it the country's biggest-ever stock offering.
Another IPO that is in the pipeline - by the National Stock Exchange of India - is likely to be worth about $3.3 billion.
Here are the five largest Indian IPOs to date:
HYUNDAI MOTOR INDIA
Hyundai HYUN.NS, the world's third-largest automaker and India's fourth-biggest passenger vehicle maker, raised 278.7 billion rupees ($2.95 billion) in October 2024 in what is currently India's biggest-ever IPO.
The manufacturer's South Korean parent 005380.KS sold a 17.5% stake in a pure offer-for-sale, where existing shareholders sell shares and no new capital is raised. Jio Platforms is expected to use a similar approach, with the company's major investors set to dilute their stakes.
LIFE INSURANCE CORPORATION OF INDIA
The government pocketed roughly 205 billion rupees ($2.17 billion) from selling a 3.5% stake in India's largest insurer and biggest domestic financial investor LIFI.NS, a far cry from its initial target of up to $12 billion.
The shares slid nearly 8% on their debut.
PAYTM
Paytm PAYT.NS, an Indian fintech firm, raised 183 billion rupees in November 2021 in a mix of a fresh share issue and an offer for sale. Ant Group reduced its stake to 23% from 28% and SoftBank's Vision Fund pared its holding to 16%.
Paytm lost more than 27% on its debut, the biggest listing-day drop in Indian IPO history at the time.
TATA CAPITAL
The Tata Group's financial services arm TATC.NS raised 155 billion rupees in October 2025, with Tata Sons and IFC among those selling in the offer for sale component alongside a fresh issue. The IPO was the largest-ever by a non-banking financial company in India. The shares listed at a slight premium of 1.23%.
LG ELECTRONICS INDIA
South Korean parent LG Electronics 066570.KS offloaded a 15% stake in its Indian unit LGEL.NS, a maker of refrigerators, washing machines, air conditioners and televisions, in a pure offer for sale issue, netting 116 billion rupees in October 2025.
The IPO was oversubscribed 54 times - the most heavily subscribed major Indian IPO since Reliance Power's listing in 2008 - attracting bids worth about 4.4 trillion rupees.
LG's shares surged 50% on their first day of trading, valuing the unit higher than its Seoul-based parent.
($1 = 94.3800 Indian rupees)
(Reporting by Vibhuti Sharma and Jayshree P. Upadhyay in Mumbai; Editing by AdityaKate Mayberry and Kevin Buckland)
(([email protected];))
Adds details throughout on Jio Platforms
MUMBAI, June 19 (Reuters) - Indian billionaire Mukesh Ambani's Reliance Jio Platforms filed regulatory papers for an IPO on Friday that sources said would raise about $3.8 billion, making it the country's biggest-ever stock offering.
Another IPO that is in the pipeline - by the National Stock Exchange of India - is likely to be worth about $3.3 billion.
Here are the five largest Indian IPOs to date:
HYUNDAI MOTOR INDIA
Hyundai HYUN.NS, the world's third-largest automaker and India's fourth-biggest passenger vehicle maker, raised 278.7 billion rupees ($2.95 billion) in October 2024 in what is currently India's biggest-ever IPO.
The manufacturer's South Korean parent 005380.KS sold a 17.5% stake in a pure offer-for-sale, where existing shareholders sell shares and no new capital is raised. Jio Platforms is expected to use a similar approach, with the company's major investors set to dilute their stakes.
LIFE INSURANCE CORPORATION OF INDIA
The government pocketed roughly 205 billion rupees ($2.17 billion) from selling a 3.5% stake in India's largest insurer and biggest domestic financial investor LIFI.NS, a far cry from its initial target of up to $12 billion.
The shares slid nearly 8% on their debut.
PAYTM
Paytm PAYT.NS, an Indian fintech firm, raised 183 billion rupees in November 2021 in a mix of a fresh share issue and an offer for sale. Ant Group reduced its stake to 23% from 28% and SoftBank's Vision Fund pared its holding to 16%.
Paytm lost more than 27% on its debut, the biggest listing-day drop in Indian IPO history at the time.
TATA CAPITAL
The Tata Group's financial services arm TATC.NS raised 155 billion rupees in October 2025, with Tata Sons and IFC among those selling in the offer for sale component alongside a fresh issue. The IPO was the largest-ever by a non-banking financial company in India. The shares listed at a slight premium of 1.23%.
LG ELECTRONICS INDIA
South Korean parent LG Electronics 066570.KS offloaded a 15% stake in its Indian unit LGEL.NS, a maker of refrigerators, washing machines, air conditioners and televisions, in a pure offer for sale issue, netting 116 billion rupees in October 2025.
The IPO was oversubscribed 54 times - the most heavily subscribed major Indian IPO since Reliance Power's listing in 2008 - attracting bids worth about 4.4 trillion rupees.
LG's shares surged 50% on their first day of trading, valuing the unit higher than its Seoul-based parent.
($1 = 94.3800 Indian rupees)
(Reporting by Vibhuti Sharma and Jayshree P. Upadhyay in Mumbai; Editing by AdityaKate Mayberry and Kevin Buckland)
(([email protected];))
Listing will see existing shareholders offering to sell about 6% of equity
Estimated $3.3 billion IPO to value India's biggest bourse at $57 billion
State Bank of India to make $498 million, Temasek to make $219 million
By Jayshree P Upadhyay
MUMBAI, June 18 (Reuters) - Investors from Indian state-owned lenders to Singapore's sovereign wealth fund and Canada's national pension manager are set to reap a $2.6 billion windfall as India's National Stock Exchange (NSE) moves ahead with a long-awaited listing.
NSE - the country's largest bourse and the world's most active derivatives exchange - filed draft papers for an initial public offering late on Wednesday, following years of regulatory delays.
The listing will be a pure offer-for-sale, with existing shareholders offering to sell about 6% of the exchange's equity and no fresh equity raised.
NSE has more than 200,000 investors currently, and its shares trade at close to 2,000 rupees ($21.18) in the unlisted market, according to trading platforms. That suggests a valuation of some $57 billion, setting the bourse up to become the world's fifth most valuable after London Stock Exchange Group.
The exchange may offer shares at a 5% to 10% discount to private market valuations, said three sources, including merchant bankers. The valuation under discussion is around 1,900 rupees per share, they added, declining to be identified as they are not authorised to speak to the media.
"At this valuation NSE would attract incoming investors while not short-changing existing ones," one source said.
A final decision on pricing will be taken closer to listing, following investor roadshows.
At 1,900 rupees per share, the IPO would be worth $3.3 billion, making it one of India's two largest public offerings alongside Mukesh Ambani’s Reliance Jio, which is likely to list this year in an IPO worth some $4 billion.
NSE said it could not comment beyond that it has filed an IPO prospectus when asked by Reuters about the valuation.
WINDFALL GAINS
The top ten investors offering shares are set for a windfall worth some $2.6 billion, based on acquisition prices disclosed in the draft prospectus.
State Bank of India, the country’s largest lender, will lock in gains of about 47 billion rupees ($497.67 million), while MS Strategic (Mauritius), a Morgan Stanley fund, will make about 29.34 billion rupees, according to Reuters calculations based on prospectus disclosures and valuation estimates.
Singapore's Temasek stands to make 20.67 billion rupees via its Aranda Investment arm, and Canada Pension Plan Investment Board will gain 18.71 billion rupees.
State Bank of India, Morgan Stanley and Temasek did not immediately respond to emails seeking comment. CPPIB declined to comment.
Anubhav Dayal, founder of Hong Kong-headquartered Soach Global Corporation, said its flagship fund first bought into NSE in early 2016 and is now selling 20% of its holding to provide liquidity to investors.
"It has proven to be a great investment. We saw the potential in NSE to serve India's masses," Dayal said, adding that the firm continues to hold NSE as a key investment. "NSE will continue to play an important role in India's economic activity."
GROWTH PROSPECTS AND REGULATORY RISKS
The exchange is likely to begin IPO roadshows over the next two months, the sources said, adding that both domestic mutual funds and global funds have shown early interest in anchoring the issue.
The exchange’s revenue has more than doubled between April 2019 and April 2026 to about 187 billion rupees, driven by strong growth in options trading. However, growth has slowed over the past year after a series of regulatory curbs on derivatives.
The exchange, detailing regulatory risks in its filing, said revenue could continue to be impacted by government and regulatory measures aimed at tempering derivatives activity.
In its IPO papers, NSE said growth will hinge on continued expansion in first-time investors, rising trading activity, innovation in derivatives products and a push into commodities.
Ravi Varanasi, a former group president at NSE who now runs a consultancy advising Indian exchanges, said NSE's near-total grip on the cash market gives it a strong long-term growth opportunity.
"As India’s market capitalisation deepens, cash trading volumes are expected to rise steadily," he said.
($1 = 94.5250 Indian rupees)
(Reporting by Jayshree P Upadhyay; Additional reporting by Bharath Rajeswaran in Bengaluru; Editing by Ira Dugal and Kevin Buckland)
(([email protected]; 9920092491; Reuters Messaging: Twitter: @jaysh88))
Listing will see existing shareholders offering to sell about 6% of equity
Estimated $3.3 billion IPO to value India's biggest bourse at $57 billion
State Bank of India to make $498 million, Temasek to make $219 million
By Jayshree P Upadhyay
MUMBAI, June 18 (Reuters) - Investors from Indian state-owned lenders to Singapore's sovereign wealth fund and Canada's national pension manager are set to reap a $2.6 billion windfall as India's National Stock Exchange (NSE) moves ahead with a long-awaited listing.
NSE - the country's largest bourse and the world's most active derivatives exchange - filed draft papers for an initial public offering late on Wednesday, following years of regulatory delays.
The listing will be a pure offer-for-sale, with existing shareholders offering to sell about 6% of the exchange's equity and no fresh equity raised.
NSE has more than 200,000 investors currently, and its shares trade at close to 2,000 rupees ($21.18) in the unlisted market, according to trading platforms. That suggests a valuation of some $57 billion, setting the bourse up to become the world's fifth most valuable after London Stock Exchange Group.
The exchange may offer shares at a 5% to 10% discount to private market valuations, said three sources, including merchant bankers. The valuation under discussion is around 1,900 rupees per share, they added, declining to be identified as they are not authorised to speak to the media.
"At this valuation NSE would attract incoming investors while not short-changing existing ones," one source said.
A final decision on pricing will be taken closer to listing, following investor roadshows.
At 1,900 rupees per share, the IPO would be worth $3.3 billion, making it one of India's two largest public offerings alongside Mukesh Ambani’s Reliance Jio, which is likely to list this year in an IPO worth some $4 billion.
NSE said it could not comment beyond that it has filed an IPO prospectus when asked by Reuters about the valuation.
WINDFALL GAINS
The top ten investors offering shares are set for a windfall worth some $2.6 billion, based on acquisition prices disclosed in the draft prospectus.
State Bank of India, the country’s largest lender, will lock in gains of about 47 billion rupees ($497.67 million), while MS Strategic (Mauritius), a Morgan Stanley fund, will make about 29.34 billion rupees, according to Reuters calculations based on prospectus disclosures and valuation estimates.
Singapore's Temasek stands to make 20.67 billion rupees via its Aranda Investment arm, and Canada Pension Plan Investment Board will gain 18.71 billion rupees.
State Bank of India, Morgan Stanley and Temasek did not immediately respond to emails seeking comment. CPPIB declined to comment.
Anubhav Dayal, founder of Hong Kong-headquartered Soach Global Corporation, said its flagship fund first bought into NSE in early 2016 and is now selling 20% of its holding to provide liquidity to investors.
"It has proven to be a great investment. We saw the potential in NSE to serve India's masses," Dayal said, adding that the firm continues to hold NSE as a key investment. "NSE will continue to play an important role in India's economic activity."
GROWTH PROSPECTS AND REGULATORY RISKS
The exchange is likely to begin IPO roadshows over the next two months, the sources said, adding that both domestic mutual funds and global funds have shown early interest in anchoring the issue.
The exchange’s revenue has more than doubled between April 2019 and April 2026 to about 187 billion rupees, driven by strong growth in options trading. However, growth has slowed over the past year after a series of regulatory curbs on derivatives.
The exchange, detailing regulatory risks in its filing, said revenue could continue to be impacted by government and regulatory measures aimed at tempering derivatives activity.
In its IPO papers, NSE said growth will hinge on continued expansion in first-time investors, rising trading activity, innovation in derivatives products and a push into commodities.
Ravi Varanasi, a former group president at NSE who now runs a consultancy advising Indian exchanges, said NSE's near-total grip on the cash market gives it a strong long-term growth opportunity.
"As India’s market capitalisation deepens, cash trading volumes are expected to rise steadily," he said.
($1 = 94.5250 Indian rupees)
(Reporting by Jayshree P Upadhyay; Additional reporting by Bharath Rajeswaran in Bengaluru; Editing by Ira Dugal and Kevin Buckland)
(([email protected]; 9920092491; Reuters Messaging: Twitter: @jaysh88))
By Jayshree P Upadhyay
MUMBAI, June 5 (Reuters) - An official Indian investigation into gold company Rajesh Exports REXP.NS has alleged that the firm overstated revenue of its Swiss refining unit Valcambi to the tune of $159 billion - a figure unheard of in the country's accounting probes.
The scale of the alleged misreporting, released publicly by the markets regulator on Wednesday, has raised questions about how investors and analysts missed this, especially because India's state-run insurance giant LIC owns 11% of the company.
Rajesh Exports has denied wrongdoing. On Friday, in an exchange statement, the company said, "the major point mis-interpreted with regard to the revenues of the company is totally misplaced." Valcambi and LIC have not responded to Reuters queries.
Here are some of the Securities and Exchange Board of India's (SEBI) preliminary findings.
REVENUE INFLATION AND VALCAMBI
Valcambi, one of the world’s largest refiners of precious metals, was owned by European Gold Refineries until a 2015 all-cash sale to Rajesh Exports.
SEBI said Rajesh Exports allegedly inflated its reported India revenue by 15.15 trillion rupees ($158.93 billion) between April 2020 and March 2025. Almost all of the company's revenue was attributed to Valcambi, the group’s main operating entity, though its standalone accounts showed revenue of $70 million to $100 million, SEBI said.
Rajesh Exports Chairman Rajesh Mehta did not comment on the difference between Valcambi's revenues and the Indian unit's financials on Thursday, but he told Reuters all disclosures were correct.
"There seems to be some miscommunication with SEBI and a gap of information. The financials are perfect," Mehta said, adding that the company "will continue to cooperate."
Rajesh Exports is listed in Mumbai and its shares have fallen 10% in the wake of SEBI's order.
WHAT DOES RAJESH EXPORTS DO?
Rajesh Mehta and his brother started Rajesh Exports in 1989 in Bengaluru.
It has since expanded to 12 countries and calls itself a "global leader in the gold business," spanning refining to retailing.
The company gained global prominence after its 2015 acquisition of Valcambi for $400 million.
MISSING MINES IN AFRICA
SEBI has alleged that Rajesh Exports disclosed to Indian exchanges that it invested 10.35 billion Indian rupees in gold mines in Africa.
But an examination of the financial statements of its subsidiaries did not find "supporting documentation demonstrating the existence of the alleged investment in gold mines in Africa," according to SEBI's order.
When asked, Rajesh Exports told SEBI that investments in gold mines existed through foreign subsidiaries and the investment figures were “tallying and correct,” the order showed.
FICTITIOUS TRADES
SEBI said Rajesh Exports recorded "fictitious revenue" in its dealings with a local broker. More than 114 billion rupees were booked as sales and purchases despite a lack of evidence of genuine transactions or banking links.
SEBI started its probe into the company in 2024 after a complaint cited large, outstanding trade receivables.
SEBI appointed a forensic auditor who could verify only a fraction of the company's reported numbers due to a lack of documentation, the regulator said.
(Reporting by Jayshree P Upadhyay, additional reporting by Rajendra Jadhav in Mumbai; Editing by Aditya Kalra and Thomas Derpinghaus)
(([email protected]; 9920092491; Reuters Messaging: Twitter: @jaysh88))
By Jayshree P Upadhyay
MUMBAI, June 5 (Reuters) - An official Indian investigation into gold company Rajesh Exports REXP.NS has alleged that the firm overstated revenue of its Swiss refining unit Valcambi to the tune of $159 billion - a figure unheard of in the country's accounting probes.
The scale of the alleged misreporting, released publicly by the markets regulator on Wednesday, has raised questions about how investors and analysts missed this, especially because India's state-run insurance giant LIC owns 11% of the company.
Rajesh Exports has denied wrongdoing. On Friday, in an exchange statement, the company said, "the major point mis-interpreted with regard to the revenues of the company is totally misplaced." Valcambi and LIC have not responded to Reuters queries.
Here are some of the Securities and Exchange Board of India's (SEBI) preliminary findings.
REVENUE INFLATION AND VALCAMBI
Valcambi, one of the world’s largest refiners of precious metals, was owned by European Gold Refineries until a 2015 all-cash sale to Rajesh Exports.
SEBI said Rajesh Exports allegedly inflated its reported India revenue by 15.15 trillion rupees ($158.93 billion) between April 2020 and March 2025. Almost all of the company's revenue was attributed to Valcambi, the group’s main operating entity, though its standalone accounts showed revenue of $70 million to $100 million, SEBI said.
Rajesh Exports Chairman Rajesh Mehta did not comment on the difference between Valcambi's revenues and the Indian unit's financials on Thursday, but he told Reuters all disclosures were correct.
"There seems to be some miscommunication with SEBI and a gap of information. The financials are perfect," Mehta said, adding that the company "will continue to cooperate."
Rajesh Exports is listed in Mumbai and its shares have fallen 10% in the wake of SEBI's order.
WHAT DOES RAJESH EXPORTS DO?
Rajesh Mehta and his brother started Rajesh Exports in 1989 in Bengaluru.
It has since expanded to 12 countries and calls itself a "global leader in the gold business," spanning refining to retailing.
The company gained global prominence after its 2015 acquisition of Valcambi for $400 million.
MISSING MINES IN AFRICA
SEBI has alleged that Rajesh Exports disclosed to Indian exchanges that it invested 10.35 billion Indian rupees in gold mines in Africa.
But an examination of the financial statements of its subsidiaries did not find "supporting documentation demonstrating the existence of the alleged investment in gold mines in Africa," according to SEBI's order.
When asked, Rajesh Exports told SEBI that investments in gold mines existed through foreign subsidiaries and the investment figures were “tallying and correct,” the order showed.
FICTITIOUS TRADES
SEBI said Rajesh Exports recorded "fictitious revenue" in its dealings with a local broker. More than 114 billion rupees were booked as sales and purchases despite a lack of evidence of genuine transactions or banking links.
SEBI started its probe into the company in 2024 after a complaint cited large, outstanding trade receivables.
SEBI appointed a forensic auditor who could verify only a fraction of the company's reported numbers due to a lack of documentation, the regulator said.
(Reporting by Jayshree P Upadhyay, additional reporting by Rajendra Jadhav in Mumbai; Editing by Aditya Kalra and Thomas Derpinghaus)
(([email protected]; 9920092491; Reuters Messaging: Twitter: @jaysh88))
May 27 (Reuters) -
INDIA SAID TO PREPARE $1 BILLION LIC STAKE SALE NEXT MONTH - BLOOMBERG NEWS
Source text: https://tinyurl.com/3veredwn
Further company coverage: LIFI.NS
(([email protected];))
May 27 (Reuters) -
INDIA SAID TO PREPARE $1 BILLION LIC STAKE SALE NEXT MONTH - BLOOMBERG NEWS
Source text: https://tinyurl.com/3veredwn
Further company coverage: LIFI.NS
(([email protected];))
May 22 (Reuters) - Shares of India's Life Insurance Corporation of India LIFI.NS climbed as much as 4.85% on Friday after it reported a 23% rise in quarterly profit helped by strong group business growth and continued momentum from last year's tax cuts.
(Reporting by Urvi Dugar in Bengaluru; Editing by Nivedita Bhattacharjee)
(([email protected]; +91 9558725583;))
May 22 (Reuters) - Shares of India's Life Insurance Corporation of India LIFI.NS climbed as much as 4.85% on Friday after it reported a 23% rise in quarterly profit helped by strong group business growth and continued momentum from last year's tax cuts.
(Reporting by Urvi Dugar in Bengaluru; Editing by Nivedita Bhattacharjee)
(([email protected]; +91 9558725583;))
May 21 (Reuters) - Life Insurance Corporation of India LIFI.NS:
Q4 PAT 234.2 BILLION RUPEES
Q4 NET PREMIUM INCOME 1.65 TRLN RUPEES
DIVIDEND 10 RUPEES PER SHARE
Further company coverage: LIFI.NS
(([email protected];;))
May 21 (Reuters) - Life Insurance Corporation of India LIFI.NS:
Q4 PAT 234.2 BILLION RUPEES
Q4 NET PREMIUM INCOME 1.65 TRLN RUPEES
DIVIDEND 10 RUPEES PER SHARE
Further company coverage: LIFI.NS
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By Nikunj Ohri
NEW DELHI, May 18 (Reuters) - India's finance ministry directed state-run banks, insurers and financial institutions on Monday to implement cost-cutting measures, including sharp curbs on travel and a phased transition to electric vehicles, according to an order reviewed by Reuters.
The order, part of a broader austerity push, will cover institutions like the State Bank of India SBI.NS, Bank of Baroda BOB.NS and Life Insurance Corp of India LIFI.NS and million of their employees across the country.
Under the new measures, all meetings, reviews and consultations must be conducted via video conferencing unless physical presence is deemed essential, the order issued by the Department of Financial Services said.
Foreign travel by top executives of the organisations - including chairpersons, managing directors and chief executive officers - should be kept below prescribed limits, with overseas engagements to be attended virtually wherever possible, it said.
Separately, the government has asked the organisations to accelerate adoption of electric vehicles.
"All organisations may aim at replacing the petrol and diesel vehicles hired by them in their head offices and branch offices by electric cars as far as possible," the order said.
The move follows a call last week by Prime Minister Narendra Modi urging officials to follow austerity and exercise restraint in spending, as the government braces for the economic fallout from rising global tensions.
Prolonged Middle East conflict risks slowing growth, stoking inflation and straining the balance of payments, with the Indian rupee already at record lows as Asia's worst performer this year.
Several Indian states have directed employees to work from home two days a week as part of cost-cutting efforts.
(Reporting by Nikunj Ohri; Editing by Raju Gopalakrishnan)
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By Nikunj Ohri
NEW DELHI, May 18 (Reuters) - India's finance ministry directed state-run banks, insurers and financial institutions on Monday to implement cost-cutting measures, including sharp curbs on travel and a phased transition to electric vehicles, according to an order reviewed by Reuters.
The order, part of a broader austerity push, will cover institutions like the State Bank of India SBI.NS, Bank of Baroda BOB.NS and Life Insurance Corp of India LIFI.NS and million of their employees across the country.
Under the new measures, all meetings, reviews and consultations must be conducted via video conferencing unless physical presence is deemed essential, the order issued by the Department of Financial Services said.
Foreign travel by top executives of the organisations - including chairpersons, managing directors and chief executive officers - should be kept below prescribed limits, with overseas engagements to be attended virtually wherever possible, it said.
Separately, the government has asked the organisations to accelerate adoption of electric vehicles.
"All organisations may aim at replacing the petrol and diesel vehicles hired by them in their head offices and branch offices by electric cars as far as possible," the order said.
The move follows a call last week by Prime Minister Narendra Modi urging officials to follow austerity and exercise restraint in spending, as the government braces for the economic fallout from rising global tensions.
Prolonged Middle East conflict risks slowing growth, stoking inflation and straining the balance of payments, with the Indian rupee already at record lows as Asia's worst performer this year.
Several Indian states have directed employees to work from home two days a week as part of cost-cutting efforts.
(Reporting by Nikunj Ohri; Editing by Raju Gopalakrishnan)
(([email protected];))
April 28 (Reuters) - HCL Technologies Ltd HCLT.NS:
HCLTECH - LIC RAISES STAKE IN CO TO 7.010% FROM 5.003%
Source text: ID:nnAZN4ST4ID
Further company coverage: HCLT.NS
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April 28 (Reuters) - HCL Technologies Ltd HCLT.NS:
HCLTECH - LIC RAISES STAKE IN CO TO 7.010% FROM 5.003%
Source text: ID:nnAZN4ST4ID
Further company coverage: HCLT.NS
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April 22 (Reuters) - Reliance Communications Ltd RLCM.NS:
CENTRAL BUREAU OF INVESTIGATION CONDUCTED SEIZURE OPERATION AT CO'S MUMBAI PREMISES
COMPANY CONTINUES TO OPERATE ITS BUSINESS IN THE NORMAL COURSE
SEIZURE OPERATION NOT EXPECTED TO HAVE ANY IMPACT ON THE FINANCIALS OR OPERATIONS OF CO
CBI OFFICIALS SEIZED DOCUMENTS PERTAINING TO NCDS, COMMERCIAL PAPERS ISSUED TO LIC
Further company coverage: RLCM.NS
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April 22 (Reuters) - Reliance Communications Ltd RLCM.NS:
CENTRAL BUREAU OF INVESTIGATION CONDUCTED SEIZURE OPERATION AT CO'S MUMBAI PREMISES
COMPANY CONTINUES TO OPERATE ITS BUSINESS IN THE NORMAL COURSE
SEIZURE OPERATION NOT EXPECTED TO HAVE ANY IMPACT ON THE FINANCIALS OR OPERATIONS OF CO
CBI OFFICIALS SEIZED DOCUMENTS PERTAINING TO NCDS, COMMERCIAL PAPERS ISSUED TO LIC
Further company coverage: RLCM.NS
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April 13 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - BOARD APPROVES ISSUANCE OF BONUS EQUITY SHARES IN 1:1 RATIO
Source text: ID:nBSE2GksnW
Further company coverage: LIFI.NS
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April 13 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - BOARD APPROVES ISSUANCE OF BONUS EQUITY SHARES IN 1:1 RATIO
Source text: ID:nBSE2GksnW
Further company coverage: LIFI.NS
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April 7 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - TO CONSIDER BONUS ISSUE
Source text: [ID:]
Further company coverage: LIFI.NS
(([email protected];))
April 7 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - TO CONSIDER BONUS ISSUE
Source text: [ID:]
Further company coverage: LIFI.NS
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March 25 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC- RECEIVES TAX DEMAND OF 61.47 BILLION RUPEES AND INTEREST OF 9.53 BILLION RUPEES
Source text: ID:nBSE2HtR4v
Further company coverage: LIFI.NS
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March 25 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC- RECEIVES TAX DEMAND OF 61.47 BILLION RUPEES AND INTEREST OF 9.53 BILLION RUPEES
Source text: ID:nBSE2HtR4v
Further company coverage: LIFI.NS
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Adds IDBI's response from exchange filing
By Urvi Dugar and Mridula Kumar
BENGALURU, Mar 16 (Reuters) - Shares of IDBI Bank IDBI.NS slumped as much as 16.5% on Monday after reports that the Indian government would shelve bids for a majority stake in the lender, as the offers were below the minimum price expectation.
The shares were trading 15.2% lower at 78.20 rupees as of 12:57 a.m. IST, set for their biggest single-day drop since June 2024.
The government has been trying to sell a stake in IDBI Bank for the last four years as part of a broader push to privatise state-run firms. The planned sale included a 30.48% stake held by the government and a 30.24% stake by state-run insurer Life Insurance Corp LIFI.NS, which had rescued IDBI in 2018 after it was weighed down by bad loans.
The government had planned to complete the sale by the end of this month.
IDBI said in an exchange filing that it had received no government communication on the disinvestment process, which it said was being handled by the Department of Investment and Public Asset Management and did not involve the bank.
The tepid interest for IDBI Bank contrasts with strong foreign investor appetite for Indian lenders, underscored by Emirates NBD's ENBD.DU buying a 60% stake in RBL Bank RATB.NS for $3 billion and Sumitomo Mitsui Banking Corp 8316.T acquiring a 24% stake in Yes Bank YESB.NS.
IDBI's stake sale had attracted bids from the Canadian investment group Fairfax Financial FFH.TO and Emirates NBD, Reuters reported in February.
A source told Reuters on Friday that the government may initiate a fresh process for IDBI Bank when market appetite improves.
The run-up in IDBI's stock ahead of the expected deal has now reversed since the transaction has fallen through, said Vinit Bolinjkar, head of research at Ventura Securities, though he has no concerns about the bank's fundamentals.
Until Friday's close, the shares had gained 116% since October 2022, when the divestment process was first announced. The state-run bank index .NIFTYPSU rose 182% over the same period.
The finance ministry did not immediately respond to Reuters' requests for comment on Monday.
($1 = 92.4525 Indian rupees)
(Reporting by Urvi Dugar and Mridula Kumar in Bengaluru; Editing by Mrigank Dhaniwala)
(([email protected]; +91 9558725583;))
Adds IDBI's response from exchange filing
By Urvi Dugar and Mridula Kumar
BENGALURU, Mar 16 (Reuters) - Shares of IDBI Bank IDBI.NS slumped as much as 16.5% on Monday after reports that the Indian government would shelve bids for a majority stake in the lender, as the offers were below the minimum price expectation.
The shares were trading 15.2% lower at 78.20 rupees as of 12:57 a.m. IST, set for their biggest single-day drop since June 2024.
The government has been trying to sell a stake in IDBI Bank for the last four years as part of a broader push to privatise state-run firms. The planned sale included a 30.48% stake held by the government and a 30.24% stake by state-run insurer Life Insurance Corp LIFI.NS, which had rescued IDBI in 2018 after it was weighed down by bad loans.
The government had planned to complete the sale by the end of this month.
IDBI said in an exchange filing that it had received no government communication on the disinvestment process, which it said was being handled by the Department of Investment and Public Asset Management and did not involve the bank.
The tepid interest for IDBI Bank contrasts with strong foreign investor appetite for Indian lenders, underscored by Emirates NBD's ENBD.DU buying a 60% stake in RBL Bank RATB.NS for $3 billion and Sumitomo Mitsui Banking Corp 8316.T acquiring a 24% stake in Yes Bank YESB.NS.
IDBI's stake sale had attracted bids from the Canadian investment group Fairfax Financial FFH.TO and Emirates NBD, Reuters reported in February.
A source told Reuters on Friday that the government may initiate a fresh process for IDBI Bank when market appetite improves.
The run-up in IDBI's stock ahead of the expected deal has now reversed since the transaction has fallen through, said Vinit Bolinjkar, head of research at Ventura Securities, though he has no concerns about the bank's fundamentals.
Until Friday's close, the shares had gained 116% since October 2022, when the divestment process was first announced. The state-run bank index .NIFTYPSU rose 182% over the same period.
The finance ministry did not immediately respond to Reuters' requests for comment on Monday.
($1 = 92.4525 Indian rupees)
(Reporting by Urvi Dugar and Mridula Kumar in Bengaluru; Editing by Mrigank Dhaniwala)
(([email protected]; +91 9558725583;))
Recasts throughout, changes sourcing
March 13 (Reuters) - India will shelve the bids it received for a majority stake sale in IDBI Bank IDBI.NS, as the offers received were below the government's minimum price expectation, a government source told Reuters.
The Indian government and state-owned Life Insurance Corporation of India LIFI.NS had initiated the process to sell 60.7% of the lender in 2022.
India's government owns 45.48% of IDBI Bank, while LIC holds 49.24%.
The existing sale process would be scrapped as the bids received were below the so-called reserve price, or the minimum sale price, set for the sale, the source said.
Bloomberg News reported the development first.
The government may initiate a fresh process when the market appetite improves and there is strong interest among buyers, the source added.
IDBI Bank and India's finance ministry didn't immediately respond to a Reuters request for comment outside regular business hours.
Reuters had reported that the planned sale of IDBI Bank had attracted bids from Canadian investment group Fairfax Financial FFH.TO and Emirates NBD ENBD.DU.
Tepid interest in acquiring the lender controlled by LIC contrasts with strong foreign investor appetite underscored by Dubai-based Emirates NBD's ENBD.DU $3 billion purchase of a 60% stake in RBL Bank RATB.NS and Sumitomo Mitsui Banking Corp's acquisition of a 24% stake in Yes Bank YESB.NS.
(Reporting by Nikunj Ohri and Anna Peverieri; Editing by Louise Heavens)
(([email protected];))
Recasts throughout, changes sourcing
March 13 (Reuters) - India will shelve the bids it received for a majority stake sale in IDBI Bank IDBI.NS, as the offers received were below the government's minimum price expectation, a government source told Reuters.
The Indian government and state-owned Life Insurance Corporation of India LIFI.NS had initiated the process to sell 60.7% of the lender in 2022.
India's government owns 45.48% of IDBI Bank, while LIC holds 49.24%.
The existing sale process would be scrapped as the bids received were below the so-called reserve price, or the minimum sale price, set for the sale, the source said.
Bloomberg News reported the development first.
The government may initiate a fresh process when the market appetite improves and there is strong interest among buyers, the source added.
IDBI Bank and India's finance ministry didn't immediately respond to a Reuters request for comment outside regular business hours.
Reuters had reported that the planned sale of IDBI Bank had attracted bids from Canadian investment group Fairfax Financial FFH.TO and Emirates NBD ENBD.DU.
Tepid interest in acquiring the lender controlled by LIC contrasts with strong foreign investor appetite underscored by Dubai-based Emirates NBD's ENBD.DU $3 billion purchase of a 60% stake in RBL Bank RATB.NS and Sumitomo Mitsui Banking Corp's acquisition of a 24% stake in Yes Bank YESB.NS.
(Reporting by Nikunj Ohri and Anna Peverieri; Editing by Louise Heavens)
(([email protected];))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Shritama Bose
MUMBAI, March 9 (Reuters Breakingviews) - A dealmaking boom in India's banking sector has an unlikely loser: the government. Canadian insurance holding firm Fairfax Financial FFH.TO leads the race to buy a 61% stake from Indian state entities in $13 billion IDBI Bank IDBI.NS, Bloomberg reported in February, citing sources. An $8 billion transaction would be the largest-ever foreign direct investment in a local bank. But crystallising a premium valuation looks challenging.
A deal would complete a full circle for the lender hardest hit by an asset quality crisis: in 2018, bad loans comprised nearly one-third of its portfolio. Provisions for that sour pool eroded its capital base and prompted New Delhi, which then owned 86% of IDBI, to press state-backed Life Insurance Corporation LIFI.NS to pump in 216 billion rupees, or $2.4 billion at current rates, to raise its 8% stake to 51% in 2019.
LIC now holds 49% of IDBI's shares and the government owns 45%. Selling a 30% stake to Fairfax at the latest market price would fetch the insurer a 136% return on its 2019 investment. New Delhi would be worse off, though: the lender's shares trade lower than they did 13 years ago.
Yet even current multiples may be difficult to fetch. IDBI's shares are trading at about 2 times forward book value, almost twice that of similar-sized rivals Yes Bank YESB.NS and IDFC First Bank IDFB.NS. Throwing in employee liabilities, restructuring costs and the likely absence of indemnity clauses gives the buyer a strong case for a discount.
An abundance of takeover targets has hurt New Delhi, too. Launched in 2022, the slow-moving sale process of IDBI prompted early potential bidders to look elsewhere: last year Sumitomo Mitsui Banking Corporation 8316.T bought a 24% stake in Yes Bank.
With Emirates NBD ENBD.DU still in the reckoning with Fairfax, it's a two-horse race to own IDBI. Both bidders already have a foothold in India's credit market: the Dubai-headquartered lender is set to take control of the $2 billion RBL Bank RATB.NS and Fairfax owns $675 million CSB Bank CSBB.NS.
That chips away at any shred of bargaining power left with the sellers, who can hardly demand a control premium. Regulations cap voting rights of private bank shareholders at 26%. That puts the new owner effectively at par on voting decisions with LIC and the government, which will hold a combined 34% after the sale. To maximise takings, officials could ask the central bank to relax the voting rule. The other option is to reduce their total stake to well below 26%.
Otherwise, New Delhi risks catching the weak end of India's banking M&A wave.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
Fairfax Financial Holdings is the frontrunner to buy a majority stake in IDBI Bank, Bloomberg reported on February 27, citing unnamed people familiar with the matter.
Valuing the 61% stake that the government and the Life Insurance Corporation of India hold in IDBI at the current market price of about $8 billion could make it the biggest foreign direct investment in the country's banking sector, the report added.
IDBI's shares are worth less than they were 13 years ago https://www.reuters.com/graphics/BRV-BRV/gkplkwarovb/chart.png
(Editing by Antony Currie; Production by Ujjaini Dutta)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Shritama Bose
MUMBAI, March 9 (Reuters Breakingviews) - A dealmaking boom in India's banking sector has an unlikely loser: the government. Canadian insurance holding firm Fairfax Financial FFH.TO leads the race to buy a 61% stake from Indian state entities in $13 billion IDBI Bank IDBI.NS, Bloomberg reported in February, citing sources. An $8 billion transaction would be the largest-ever foreign direct investment in a local bank. But crystallising a premium valuation looks challenging.
A deal would complete a full circle for the lender hardest hit by an asset quality crisis: in 2018, bad loans comprised nearly one-third of its portfolio. Provisions for that sour pool eroded its capital base and prompted New Delhi, which then owned 86% of IDBI, to press state-backed Life Insurance Corporation LIFI.NS to pump in 216 billion rupees, or $2.4 billion at current rates, to raise its 8% stake to 51% in 2019.
LIC now holds 49% of IDBI's shares and the government owns 45%. Selling a 30% stake to Fairfax at the latest market price would fetch the insurer a 136% return on its 2019 investment. New Delhi would be worse off, though: the lender's shares trade lower than they did 13 years ago.
Yet even current multiples may be difficult to fetch. IDBI's shares are trading at about 2 times forward book value, almost twice that of similar-sized rivals Yes Bank YESB.NS and IDFC First Bank IDFB.NS. Throwing in employee liabilities, restructuring costs and the likely absence of indemnity clauses gives the buyer a strong case for a discount.
An abundance of takeover targets has hurt New Delhi, too. Launched in 2022, the slow-moving sale process of IDBI prompted early potential bidders to look elsewhere: last year Sumitomo Mitsui Banking Corporation 8316.T bought a 24% stake in Yes Bank.
With Emirates NBD ENBD.DU still in the reckoning with Fairfax, it's a two-horse race to own IDBI. Both bidders already have a foothold in India's credit market: the Dubai-headquartered lender is set to take control of the $2 billion RBL Bank RATB.NS and Fairfax owns $675 million CSB Bank CSBB.NS.
That chips away at any shred of bargaining power left with the sellers, who can hardly demand a control premium. Regulations cap voting rights of private bank shareholders at 26%. That puts the new owner effectively at par on voting decisions with LIC and the government, which will hold a combined 34% after the sale. To maximise takings, officials could ask the central bank to relax the voting rule. The other option is to reduce their total stake to well below 26%.
Otherwise, New Delhi risks catching the weak end of India's banking M&A wave.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
Fairfax Financial Holdings is the frontrunner to buy a majority stake in IDBI Bank, Bloomberg reported on February 27, citing unnamed people familiar with the matter.
Valuing the 61% stake that the government and the Life Insurance Corporation of India hold in IDBI at the current market price of about $8 billion could make it the biggest foreign direct investment in the country's banking sector, the report added.
IDBI's shares are worth less than they were 13 years ago https://www.reuters.com/graphics/BRV-BRV/gkplkwarovb/chart.png
(Editing by Antony Currie; Production by Ujjaini Dutta)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
March 2 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - LIC EXTENDS CFO SUNIL AGARWAL'S TERM UNTIL MARCH 2027
Source text: ID:nBSE4wXsK5
Further company coverage: LIFI.NS
(([email protected];))
March 2 (Reuters) - Life Insurance Corporation of India LIFI.NS:
LIC - LIC EXTENDS CFO SUNIL AGARWAL'S TERM UNTIL MARCH 2027
Source text: ID:nBSE4wXsK5
Further company coverage: LIFI.NS
(([email protected];))
Feb 20 (Reuters) - Cipla Ltd CIPL.NS:
LIC RAISES STAKE IN CIPLA TO 9.091% FROM 7.055% BETWEEN NOV AND FEB- FILING
Source text: ID:nBSE3SBW2S
Further company coverage: CIPL.NS
(([email protected];))
Feb 20 (Reuters) - Cipla Ltd CIPL.NS:
LIC RAISES STAKE IN CIPLA TO 9.091% FROM 7.055% BETWEEN NOV AND FEB- FILING
Source text: ID:nBSE3SBW2S
Further company coverage: CIPL.NS
(([email protected];))
Feb 5 (Reuters) - Life Insurance Corporation of India LIFI.NS reported a 17% rise in third-quarter profit on Thursday, aided by higher premium collection on tax cut-spurred retail demand for insurance products.
The insurer's net profit rose to 129.58 billion rupees ($1.43 billion) for the three months ended December 31, up from 110.56 billion rupees a year earlier.
($1 = 90.3050 Indian rupees)
(Reporting by Nishit Navin; Editing by Mrigank Dhaniwala)
(([email protected];))
Feb 5 (Reuters) - Life Insurance Corporation of India LIFI.NS reported a 17% rise in third-quarter profit on Thursday, aided by higher premium collection on tax cut-spurred retail demand for insurance products.
The insurer's net profit rose to 129.58 billion rupees ($1.43 billion) for the three months ended December 31, up from 110.56 billion rupees a year earlier.
($1 = 90.3050 Indian rupees)
(Reporting by Nishit Navin; Editing by Mrigank Dhaniwala)
(([email protected];))
Adds details from paragraph 2-9
By Nikunj Ohri
NEW DELHI, Feb 2 (Reuters) - The Indian government is holding inter-ministerial consultations to raise the limit on foreign direct investment in state-run banks to 49% from 20%, India's financial services secretary M Nagaraju told reporters on Monday.
Foreign interest in India's banking industry is on the rise as evidenced for instance by Dubai-based Emirates NBD's ENBD.DU $3 billion purchase of a 60% stake in private RBL Bank RATB.NS.
Currently, India allows 74% foreign investment in private banks but limits shareholdings of any single foreign institution to 15% unless the Reserve Bank of India grants an exemption.
The Asian nation plans to more than double current limits of direct foreign investment in state-run banks, Nagaraju said. Raising the foreign ownership limit will help them gain more capital in the coming years, Reuters reported last year.
Separately, India's state-run banks will launch qualified institutional placement (QIP) of shares worth about 500 billion rupees ($5.46 billion) in the fiscal 2026-27 year (April-March), more than the planned 450 billion rupees in the current fiscal year, Nagaraju said.
He was speaking to reporters in New Delhi a day after Finance Minister Nirmala Sitharaman presented the nation's annual budget .
New Delhi may also launch an offer next year to sell a portion of its stake in the insurance behemoth Life Insurance Corporation LIFI.NS, he added.
The Indian government will also get financial bids for IDBI Bank IDBI.NS this month, Nagaraju said.
The government, which owns 45.48% in IDBI Bank, and state-owned LIC which holds 49.24%, together plan to sell 60.7% of the lender. IDBI Bank had to be rescued by the state-owned insurer in 2019 after a surge in bad loans at the lender.
($1 = 91.6350 Indian rupees)
(Reporting by Nikunj Ohri; Writing by Tanvi Mehta; Editing by Sonali Paul and Raju Gopalakrishnan)
(([email protected];))
Adds details from paragraph 2-9
By Nikunj Ohri
NEW DELHI, Feb 2 (Reuters) - The Indian government is holding inter-ministerial consultations to raise the limit on foreign direct investment in state-run banks to 49% from 20%, India's financial services secretary M Nagaraju told reporters on Monday.
Foreign interest in India's banking industry is on the rise as evidenced for instance by Dubai-based Emirates NBD's ENBD.DU $3 billion purchase of a 60% stake in private RBL Bank RATB.NS.
Currently, India allows 74% foreign investment in private banks but limits shareholdings of any single foreign institution to 15% unless the Reserve Bank of India grants an exemption.
The Asian nation plans to more than double current limits of direct foreign investment in state-run banks, Nagaraju said. Raising the foreign ownership limit will help them gain more capital in the coming years, Reuters reported last year.
Separately, India's state-run banks will launch qualified institutional placement (QIP) of shares worth about 500 billion rupees ($5.46 billion) in the fiscal 2026-27 year (April-March), more than the planned 450 billion rupees in the current fiscal year, Nagaraju said.
He was speaking to reporters in New Delhi a day after Finance Minister Nirmala Sitharaman presented the nation's annual budget .
New Delhi may also launch an offer next year to sell a portion of its stake in the insurance behemoth Life Insurance Corporation LIFI.NS, he added.
The Indian government will also get financial bids for IDBI Bank IDBI.NS this month, Nagaraju said.
The government, which owns 45.48% in IDBI Bank, and state-owned LIC which holds 49.24%, together plan to sell 60.7% of the lender. IDBI Bank had to be rescued by the state-owned insurer in 2019 after a surge in bad loans at the lender.
($1 = 91.6350 Indian rupees)
(Reporting by Nikunj Ohri; Writing by Tanvi Mehta; Editing by Sonali Paul and Raju Gopalakrishnan)
(([email protected];))
By Gopika Gopakumar and Nikunj Ohri
MUMBAI, Jan 30 (Reuters) - India's federal government has set a February 5 deadline for financial bids for IDBI Bank IDBI.NS as it looks to divest a majority of its holding in the lender, according to two sources familiar with the matter.
The deadline has been communicated to bidders who are eligible for bidding, suggesting that the process of disinvestment in IDBI Bank has entered its final phase.
The central bank had approved Fairfax Financial Holdings, Emirates NBD and Kotak Mahindra Bank KTKM.NS as eligible bidders in 2024, Reuters had previously reported. The divestment process has been underway since then, with the government trying to finalize the details of the stake sale process.
The government had earlier said that it hoped to complete the stake sale process, which began in 2022, by March 2026.
The government, which owns 45.48% in IDBI Bank, and state-owned Life Insurance Corporation of India LIFI.NS which holds 49.24%, together plan to sell 60.7% of the lender.
As part of the stake sale, the successful bidder will be allowed to rename the bank, a separate source familiar with the process said.
IDBI Bank had to be rescued by the state-owned insurer in 2019 after a surge in bad loans at the lender.
An email sent to the federal finance ministry, under which the divestment process falls, was not immediately answered.
(Reporting by Gopika Gopakumar in Mumbai and Nikunj Ohri in New Delhi; Editing by Anil D'Silva)
(([email protected]; +91-9833024892;))
By Gopika Gopakumar and Nikunj Ohri
MUMBAI, Jan 30 (Reuters) - India's federal government has set a February 5 deadline for financial bids for IDBI Bank IDBI.NS as it looks to divest a majority of its holding in the lender, according to two sources familiar with the matter.
The deadline has been communicated to bidders who are eligible for bidding, suggesting that the process of disinvestment in IDBI Bank has entered its final phase.
The central bank had approved Fairfax Financial Holdings, Emirates NBD and Kotak Mahindra Bank KTKM.NS as eligible bidders in 2024, Reuters had previously reported. The divestment process has been underway since then, with the government trying to finalize the details of the stake sale process.
The government had earlier said that it hoped to complete the stake sale process, which began in 2022, by March 2026.
The government, which owns 45.48% in IDBI Bank, and state-owned Life Insurance Corporation of India LIFI.NS which holds 49.24%, together plan to sell 60.7% of the lender.
As part of the stake sale, the successful bidder will be allowed to rename the bank, a separate source familiar with the process said.
IDBI Bank had to be rescued by the state-owned insurer in 2019 after a surge in bad loans at the lender.
An email sent to the federal finance ministry, under which the divestment process falls, was not immediately answered.
(Reporting by Gopika Gopakumar in Mumbai and Nikunj Ohri in New Delhi; Editing by Anil D'Silva)
(([email protected]; +91-9833024892;))
Jan 27 (Reuters) - Bajaj Finance Ltd BJFN.NS:
LIC HAS SUBSCRIBED 512,000 DEBENTURES AMOUNTING TO 51.20 BILLION RUPEES OF BAJAJ FINANCE
Source text: ID:nBSE864q1k
Further company coverage: BJFN.NS
(([email protected];))
Jan 27 (Reuters) - Bajaj Finance Ltd BJFN.NS:
LIC HAS SUBSCRIBED 512,000 DEBENTURES AMOUNTING TO 51.20 BILLION RUPEES OF BAJAJ FINANCE
Source text: ID:nBSE864q1k
Further company coverage: BJFN.NS
(([email protected];))
Updates with more details
By Dharamraj Dhutia and Khushi Malhotra
MUMBAI, Jan 21 (Reuters) - State Bank of India's mutual fund unit has committed to pick up at least 10% of Adani Power's ADAN.NS nearly $820 million rupee-denominated bond issue, likely to be launched later this week, three merchant bankers said on Wednesday.
The mutual fund, India's biggest in terms of assets under management, is acting as one of the anchor investors for the issue, with a commitment of 7.50 billion rupees, the bankers said, requesting anonymity as they are not authorised to speak to the media.
The planned 75 billion-rupee issue would be the group's largest-ever rupee bond sale.
SBI Mutual Fund and Adani Power did not respond to email queries.
Adani Power is looking to raise 28.60 billion rupees through a two-year option and 26.90 billion rupees via a three-year note.
SBI MF will buy 4.50 billion rupees and three billion rupees of these papers as the anchor investor, the bankers said.
The Adani unit will pay a coupon of 8.00% and 8.20% on the two- and three-year bonds, and 8.30% and 8.40% on four- and five-year papers.
The remaining 6.75 billion rupees and 12.75 billion rupees will be raised through four- and five-year papers, respectively, the bankers said.
Trust Investment Advisors, ICICI Bank and Axis Bank are the arrangers for the issue.
The lenders have will also back the issue by providing commitments worth 3.31 billion rupees and 3 billion rupees, respectively, the bankers said.
The banks did not reply to an email seeking comment.
The bonds are rated 'AA' by Crisil and India Ratings, with the coupons set to step up by 25 basis points for every notch rating downgrade.
Earlier this financial year, another group company, Adani Ports and Special Economic Zone APSE.NS, raised 50 billion rupees by placing 15-year bonds directly with Life Insurance Corporation of India LIFI.NS.
($1 = 91.5630 Indian rupees)
(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Sonia Cheema)
(([email protected];))
Updates with more details
By Dharamraj Dhutia and Khushi Malhotra
MUMBAI, Jan 21 (Reuters) - State Bank of India's mutual fund unit has committed to pick up at least 10% of Adani Power's ADAN.NS nearly $820 million rupee-denominated bond issue, likely to be launched later this week, three merchant bankers said on Wednesday.
The mutual fund, India's biggest in terms of assets under management, is acting as one of the anchor investors for the issue, with a commitment of 7.50 billion rupees, the bankers said, requesting anonymity as they are not authorised to speak to the media.
The planned 75 billion-rupee issue would be the group's largest-ever rupee bond sale.
SBI Mutual Fund and Adani Power did not respond to email queries.
Adani Power is looking to raise 28.60 billion rupees through a two-year option and 26.90 billion rupees via a three-year note.
SBI MF will buy 4.50 billion rupees and three billion rupees of these papers as the anchor investor, the bankers said.
The Adani unit will pay a coupon of 8.00% and 8.20% on the two- and three-year bonds, and 8.30% and 8.40% on four- and five-year papers.
The remaining 6.75 billion rupees and 12.75 billion rupees will be raised through four- and five-year papers, respectively, the bankers said.
Trust Investment Advisors, ICICI Bank and Axis Bank are the arrangers for the issue.
The lenders have will also back the issue by providing commitments worth 3.31 billion rupees and 3 billion rupees, respectively, the bankers said.
The banks did not reply to an email seeking comment.
The bonds are rated 'AA' by Crisil and India Ratings, with the coupons set to step up by 25 basis points for every notch rating downgrade.
Earlier this financial year, another group company, Adani Ports and Special Economic Zone APSE.NS, raised 50 billion rupees by placing 15-year bonds directly with Life Insurance Corporation of India LIFI.NS.
($1 = 91.5630 Indian rupees)
(Reporting by Dharamraj Dhutia and Khushi Malhotra; Editing by Sonia Cheema)
(([email protected];))
Jan 19 (Reuters) - Hindustan Unilever Ltd HLL.NS:
LIC RAISES STAKE IN HINDUSTAN UNILEVER TO 6.740% FROM 4.731% - EXCHANGE FILING
Source text: ID:nBSE4MCpS9
Further company coverage: HLL.NS
(([email protected];))
Jan 19 (Reuters) - Hindustan Unilever Ltd HLL.NS:
LIC RAISES STAKE IN HINDUSTAN UNILEVER TO 6.740% FROM 4.731% - EXCHANGE FILING
Source text: ID:nBSE4MCpS9
Further company coverage: HLL.NS
(([email protected];))
Dec 29 (Reuters) - Life Insurance Corporation of India LIFI.NS:
GETS TAX DEMAND OF 10.4 MILLION RUPEES, WITH INTEREST OF 7 MILLION RUPEES, PENALTY 1 MILLION RUPEES
Source text: ID:nBSEb9012k
Further company coverage: LIFI.NS
(([email protected];))
Dec 29 (Reuters) - Life Insurance Corporation of India LIFI.NS:
GETS TAX DEMAND OF 10.4 MILLION RUPEES, WITH INTEREST OF 7 MILLION RUPEES, PENALTY 1 MILLION RUPEES
Source text: ID:nBSEb9012k
Further company coverage: LIFI.NS
(([email protected];))
Nov 28 (Reuters) - ACC Ltd ACC.NS:
LIC INCREASES STAKE IN ACC BY 2.014% TO 10.596% - EXCHANGE FILING
Source text: ID:nBSEcgQgcx
Further company coverage: ACC.NS
(([email protected];;))
Nov 28 (Reuters) - ACC Ltd ACC.NS:
LIC INCREASES STAKE IN ACC BY 2.014% TO 10.596% - EXCHANGE FILING
Source text: ID:nBSEcgQgcx
Further company coverage: ACC.NS
(([email protected];;))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Shritama Bose
MUMBAI, Oct 24 (Reuters Breakingviews) - India's largest companies are struggling to fit in, quite literally. Officials are easing rules on minimum free floats and offer sizes to smooth the way for big initial public offerings. It bridges a gap between a requirement for capital formation and what the market can absorb, but it comes at a cost to governance.
The Securities and Exchange Board of India last month said issuers valued at more than 5 trillion rupees ($56.8 billion) can offer stock worth as little as 150 billion rupees ($1.7 billion) in their public debuts and 1% of their post-issue market capitalisation, down from 5% earlier. It also gave issuers up to 10 years to raise their minimum public shareholding to 25%, effectively doubling the previous timeline.
Reliance Industries' RELI.NS telecom unit Jio and the National Stock Exchange, both in the queue to list, will be among the top beneficiaries. It extends to them what was originally an exemption granted to Life Insurance Corporation LIFI.NS for the state-controlled giant's bumper $2.7 billion listing in 2022.
The changes come at a time India's primary market is booming. One-billion-dollar plus offerings like those this month by LG Electronics India LGEL.NS and shadow lender Tata Capital TATC.NS are increasingly frequent. With IPOs worth $16 billion this year, per Dealogic, India is the world's third largest market for debuts and issuance is poised to exceed last year's record; Citigroup expects IPO volumes to hit up to $20 billion through the next 12 months.
Yet despite annual net inflows into the stock market of over $80 billion from domestic institutions and individuals, there is a lack of confidence among officials, issuers and bankers on the market's ability to absorb larger deals; Hyundai Motor India's HYUN.NS 279 billion Indian rupee ($3.18 billion at current rates) deal in 2024 is the country's largest IPO to date.
If India is loosening the rules to allow big companies to go public, it should strengthen other guardrails to protect minority investors that could be hurt by a low free float. Hong Kong-based Asian Corporate Governance Association disagreed with SEBI's proposal to extend the minimum free float timeline and recommends mandating at least 50% independent board directors for firms with a less than 25% public holding as well as time-bound roadmaps for dilution. Easier rules call for a tighter leash.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
India will log $8 billion in initial public offerings during the final quarter of 2025, Reuters reported on October 1, citing investment bankers.
The Securities and Exchange Board of India on September 12 allowed companies worth at least 5 trillion rupees to offer as little as 150 billion rupees of stock to the public and at least 1% of the post issue market capitalisation, down from 5% earlier.
They will have five years to achieve a minimum public shareholding of 15% and another five years to take it to 25%, the markets regulator said. Companies of that size earlier had only five years to reach the 25% level.
Indian IPO volumes are on track to beat their 2024 record https://www.reuters.com/graphics/BRV-BRV/myvmxzrjmpr/chart.png
(Editing by Una Galani; Production by Aditya Srivastav)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own.
By Shritama Bose
MUMBAI, Oct 24 (Reuters Breakingviews) - India's largest companies are struggling to fit in, quite literally. Officials are easing rules on minimum free floats and offer sizes to smooth the way for big initial public offerings. It bridges a gap between a requirement for capital formation and what the market can absorb, but it comes at a cost to governance.
The Securities and Exchange Board of India last month said issuers valued at more than 5 trillion rupees ($56.8 billion) can offer stock worth as little as 150 billion rupees ($1.7 billion) in their public debuts and 1% of their post-issue market capitalisation, down from 5% earlier. It also gave issuers up to 10 years to raise their minimum public shareholding to 25%, effectively doubling the previous timeline.
Reliance Industries' RELI.NS telecom unit Jio and the National Stock Exchange, both in the queue to list, will be among the top beneficiaries. It extends to them what was originally an exemption granted to Life Insurance Corporation LIFI.NS for the state-controlled giant's bumper $2.7 billion listing in 2022.
The changes come at a time India's primary market is booming. One-billion-dollar plus offerings like those this month by LG Electronics India LGEL.NS and shadow lender Tata Capital TATC.NS are increasingly frequent. With IPOs worth $16 billion this year, per Dealogic, India is the world's third largest market for debuts and issuance is poised to exceed last year's record; Citigroup expects IPO volumes to hit up to $20 billion through the next 12 months.
Yet despite annual net inflows into the stock market of over $80 billion from domestic institutions and individuals, there is a lack of confidence among officials, issuers and bankers on the market's ability to absorb larger deals; Hyundai Motor India's HYUN.NS 279 billion Indian rupee ($3.18 billion at current rates) deal in 2024 is the country's largest IPO to date.
If India is loosening the rules to allow big companies to go public, it should strengthen other guardrails to protect minority investors that could be hurt by a low free float. Hong Kong-based Asian Corporate Governance Association disagreed with SEBI's proposal to extend the minimum free float timeline and recommends mandating at least 50% independent board directors for firms with a less than 25% public holding as well as time-bound roadmaps for dilution. Easier rules call for a tighter leash.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
India will log $8 billion in initial public offerings during the final quarter of 2025, Reuters reported on October 1, citing investment bankers.
The Securities and Exchange Board of India on September 12 allowed companies worth at least 5 trillion rupees to offer as little as 150 billion rupees of stock to the public and at least 1% of the post issue market capitalisation, down from 5% earlier.
They will have five years to achieve a minimum public shareholding of 15% and another five years to take it to 25%, the markets regulator said. Companies of that size earlier had only five years to reach the 25% level.
Indian IPO volumes are on track to beat their 2024 record https://www.reuters.com/graphics/BRV-BRV/myvmxzrjmpr/chart.png
(Editing by Una Galani; Production by Aditya Srivastav)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own. Refiles to add conversion of Indian rupee into US dollar in the second paragraph.
By Shritama Bose
MUMBAI, Oct 16 (Reuters Breakingviews) - All that glitters isn't gold when it comes to India's richest man. When Mukesh Ambani lists his telecom business in Mumbai next year, it will be a blockbuster event for the country's capital markets but it also will crystallise underwhelming returns for the world's biggest tech companies, private equity firms and sovereign wealth funds who backed his consumer unit in 2020. It heralds a reset of how foreigners view tycoons and competition in the country.
Five years ago when the Covid pandemic was shaking the world, Ambani's conglomerate Reliance Industries RELI.NS sold 1.5 trillion rupees ($16.99 billion) of stock in Jio Platforms to investors led by Meta Platforms META.O, KKR KKR.N and Saudi Arabia's Public Investment Fund; the flood of funds into India at the time was so large it caused a spike in foreign direct investment.
At 5.16 trillion rupees including debt, or $59 billion at current exchange rates, the landmark fundraising valued Jio's enterprise at 23 times its EBITDA, a multiple twice its nearest rival Sunil Bharti Mittal's Bharti Airtel and one reminiscent of a fast-growing technology startup.
Part of the hype was justified. The telecom unit Ambani founded in 2016 rose quickly by launching a bruising price war and was given a wide berth by India's competition authorities. Jio became the country's top provider of mobile services and helped to push down data tariffs to the lowest in the world. It even accelerated the bankruptcy of Reliance Communications RLCM.NS, led by Ambani's brother Anil. By the time Ambani welcomed outside investors, India's telecoms market had shrunk to a quasi-duopoly with a joint venture between Britain's Vodafone VOD.L and Kumar Mangalam Birla as a weak third player.
Fast forward and Jio had 498 million voice and data customers as of June 30 . Yet while this consumer business within Ambani's oil-to-retail conglomerate has continued to grow, it also has failed to live up to expectations in some striking ways.
Five years on from its fundraising, Jio's enterprise, including net debt, is valued at 10.6 trillion rupees, based on an average estimate of six brokers. That is nearly twice the value investors assigned it in 2020 or equivalent to an annualised return of nearly about 15%, one percentage point more than the annualised gross return of the MSCI India Index over a five year period. Private equity investors typically target returns of 20% and much higher in India.
Measured a different way, Jio's potential return could be even lower. The enterprise is worth just 8.7 trillion rupees if it is valued on 10 times its EBITDA, the same multiple Bharti Airtel commands. At that valuation, Jio would hand its backers including KKR, Silver Lake and TPG, an annualised return of just over 10%.
One problem is that Jio does not look like a "next generation technology platform". In 2020, Jio talked up a dazzling list of investments across its "digital ecosystem" including in "smart devices, cloud and edge computing, big data analytics, artificial intelligence, Internet of Things, augmented and mixed reality and blockchain". Although Jio doesn't have legacy 3G infrastructure to manage like its rivals, it still makes 87% of its revenue and 94% of its EBITDA from its basic communications unit Reliance Jio Infocomm RELJ.NS rather than from digital services, per CLSA analysts.
What's more, Jio's customers spend less than Airtel's. Average revenue per user has grown 60% over the last five years to 209 rupees ($2.37) but that lags the 250 rupees Airtel's India users churn out. Airtel's EBITDA margin for India and South Asia is also higher than Jio's by a staggering 770 basis points and its current offerings in cloud and artificial intelligence services closely mirror its challenger's.
Nor does Jio appear to have delivered on its strategic ambitions. Meta's Facebook pumped $6 billion in for a 10% stake but Ambani - whose Reliance conglomerate is also the owner of India's biggest retailer - did not lure millions of small grocers to transact on the payments system on WhatsApp, the U.S. company's social messaging platform - as was widely expected.
The rise of quick-commerce operations by Prosus-backed Swiggy SWIG.NS and Zomato-owner Eternal ETEA.NS killed Reliance Retail's 2022 attempt to enable grocery shopping through the messaging app. Similarly, Alphabet's Google GOOGL.O invested $4.5 billion in Jio but demand for the low-cost smartphone the duo launched in 2021 was weak; the telecom operator's wide reach didn't guarantee it a market.
Ambani's backers underestimated the strength of competition in India. They would have been better off if they had backed Bharti Airtel. Its shares have returned roughly 40% annually, including dividends, since 2020, significantly more than Jio looks set to deliver. Google enjoyed some of those spoils by hedging its bets: In 2022 it invested up to $1 billion in Jio's rival.
If Jio's returns are underwhelming, crystallizing them will be tough too. Ambani will need to launch one of India's largest initial public offerings. If 5% of the company's outstanding shares swap hands at a $120 billion valuation, Jio's bankers would need to find new owners for $6 billion of stock. That would be far too much for India's capital markets to swallow: Hyundai Motor India's HYUN.NS 279 billion rupee offering in 2024 remains the country's largest IPO, followed by Life Insurance Corporation's LIFI.NS 210 billion rupee deal in 2022.
Ambani could offer half the amount of stock or roughly $3 billion, using new rules from the Securities and Exchange Board of India but that would leave financial investors with billions of dollars of investments in Jio waiting for an exit; strategic investors, who may be willing to sit on their positions, bought about half of the $17 billion Jio initially raised.
Some of Jio's backers may still conclude that the investment was worth it. The dominance of family-led businesses in India often means that striking partnerships is increasingly seen as a matter of survival rather than choice for global companies and a way to protect themselves in the market. Global asset manager BlackRock BLK.N and China-founded online fast-fashion Shein are among others who are partnering with Ambani.
Yet an underwhelming payoff from Jio will strengthen the case for more scrutiny when foreign investors choose their local alliances in the future.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
Reliance Industries will list its telecommunications unit by mid-2026, Chair Mukesh Ambani said at the conglomerate's annual shareholder meeting on August 29. "We are aiming to list Jio by the first-half of 2026, subject to all necessary approvals," he said.
Jio Platforms is targeting India's largest-ever initial public offering, IFR reported on September 5, citing unnamed bankers.
Jio's revenue per user will grow but continue to lag Airtel's https://www.reuters.com/graphics/BRV-BRV/gkplanlgqvb/chart.png
Bharti Airtel's shares have outperformed the broader market https://www.reuters.com/graphics/BRV-BRV/dwvklxzrzpm/chart.png
Global investors bought one third of Jio Platforms in 2020 https://www.reuters.com/graphics/BRV-BRV/lbvgzkljqpq/chart.png
(Editing by Una Galani; Production by Aditya Srivastav)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
The author is a Reuters Breakingviews columnist. The opinions expressed are her own. Refiles to add conversion of Indian rupee into US dollar in the second paragraph.
By Shritama Bose
MUMBAI, Oct 16 (Reuters Breakingviews) - All that glitters isn't gold when it comes to India's richest man. When Mukesh Ambani lists his telecom business in Mumbai next year, it will be a blockbuster event for the country's capital markets but it also will crystallise underwhelming returns for the world's biggest tech companies, private equity firms and sovereign wealth funds who backed his consumer unit in 2020. It heralds a reset of how foreigners view tycoons and competition in the country.
Five years ago when the Covid pandemic was shaking the world, Ambani's conglomerate Reliance Industries RELI.NS sold 1.5 trillion rupees ($16.99 billion) of stock in Jio Platforms to investors led by Meta Platforms META.O, KKR KKR.N and Saudi Arabia's Public Investment Fund; the flood of funds into India at the time was so large it caused a spike in foreign direct investment.
At 5.16 trillion rupees including debt, or $59 billion at current exchange rates, the landmark fundraising valued Jio's enterprise at 23 times its EBITDA, a multiple twice its nearest rival Sunil Bharti Mittal's Bharti Airtel and one reminiscent of a fast-growing technology startup.
Part of the hype was justified. The telecom unit Ambani founded in 2016 rose quickly by launching a bruising price war and was given a wide berth by India's competition authorities. Jio became the country's top provider of mobile services and helped to push down data tariffs to the lowest in the world. It even accelerated the bankruptcy of Reliance Communications RLCM.NS, led by Ambani's brother Anil. By the time Ambani welcomed outside investors, India's telecoms market had shrunk to a quasi-duopoly with a joint venture between Britain's Vodafone VOD.L and Kumar Mangalam Birla as a weak third player.
Fast forward and Jio had 498 million voice and data customers as of June 30 . Yet while this consumer business within Ambani's oil-to-retail conglomerate has continued to grow, it also has failed to live up to expectations in some striking ways.
Five years on from its fundraising, Jio's enterprise, including net debt, is valued at 10.6 trillion rupees, based on an average estimate of six brokers. That is nearly twice the value investors assigned it in 2020 or equivalent to an annualised return of nearly about 15%, one percentage point more than the annualised gross return of the MSCI India Index over a five year period. Private equity investors typically target returns of 20% and much higher in India.
Measured a different way, Jio's potential return could be even lower. The enterprise is worth just 8.7 trillion rupees if it is valued on 10 times its EBITDA, the same multiple Bharti Airtel commands. At that valuation, Jio would hand its backers including KKR, Silver Lake and TPG, an annualised return of just over 10%.
One problem is that Jio does not look like a "next generation technology platform". In 2020, Jio talked up a dazzling list of investments across its "digital ecosystem" including in "smart devices, cloud and edge computing, big data analytics, artificial intelligence, Internet of Things, augmented and mixed reality and blockchain". Although Jio doesn't have legacy 3G infrastructure to manage like its rivals, it still makes 87% of its revenue and 94% of its EBITDA from its basic communications unit Reliance Jio Infocomm RELJ.NS rather than from digital services, per CLSA analysts.
What's more, Jio's customers spend less than Airtel's. Average revenue per user has grown 60% over the last five years to 209 rupees ($2.37) but that lags the 250 rupees Airtel's India users churn out. Airtel's EBITDA margin for India and South Asia is also higher than Jio's by a staggering 770 basis points and its current offerings in cloud and artificial intelligence services closely mirror its challenger's.
Nor does Jio appear to have delivered on its strategic ambitions. Meta's Facebook pumped $6 billion in for a 10% stake but Ambani - whose Reliance conglomerate is also the owner of India's biggest retailer - did not lure millions of small grocers to transact on the payments system on WhatsApp, the U.S. company's social messaging platform - as was widely expected.
The rise of quick-commerce operations by Prosus-backed Swiggy SWIG.NS and Zomato-owner Eternal ETEA.NS killed Reliance Retail's 2022 attempt to enable grocery shopping through the messaging app. Similarly, Alphabet's Google GOOGL.O invested $4.5 billion in Jio but demand for the low-cost smartphone the duo launched in 2021 was weak; the telecom operator's wide reach didn't guarantee it a market.
Ambani's backers underestimated the strength of competition in India. They would have been better off if they had backed Bharti Airtel. Its shares have returned roughly 40% annually, including dividends, since 2020, significantly more than Jio looks set to deliver. Google enjoyed some of those spoils by hedging its bets: In 2022 it invested up to $1 billion in Jio's rival.
If Jio's returns are underwhelming, crystallizing them will be tough too. Ambani will need to launch one of India's largest initial public offerings. If 5% of the company's outstanding shares swap hands at a $120 billion valuation, Jio's bankers would need to find new owners for $6 billion of stock. That would be far too much for India's capital markets to swallow: Hyundai Motor India's HYUN.NS 279 billion rupee offering in 2024 remains the country's largest IPO, followed by Life Insurance Corporation's LIFI.NS 210 billion rupee deal in 2022.
Ambani could offer half the amount of stock or roughly $3 billion, using new rules from the Securities and Exchange Board of India but that would leave financial investors with billions of dollars of investments in Jio waiting for an exit; strategic investors, who may be willing to sit on their positions, bought about half of the $17 billion Jio initially raised.
Some of Jio's backers may still conclude that the investment was worth it. The dominance of family-led businesses in India often means that striking partnerships is increasingly seen as a matter of survival rather than choice for global companies and a way to protect themselves in the market. Global asset manager BlackRock BLK.N and China-founded online fast-fashion Shein are among others who are partnering with Ambani.
Yet an underwhelming payoff from Jio will strengthen the case for more scrutiny when foreign investors choose their local alliances in the future.
Follow Shritama Bose on LinkedIn and X.
CONTEXT NEWS
Reliance Industries will list its telecommunications unit by mid-2026, Chair Mukesh Ambani said at the conglomerate's annual shareholder meeting on August 29. "We are aiming to list Jio by the first-half of 2026, subject to all necessary approvals," he said.
Jio Platforms is targeting India's largest-ever initial public offering, IFR reported on September 5, citing unnamed bankers.
Jio's revenue per user will grow but continue to lag Airtel's https://www.reuters.com/graphics/BRV-BRV/gkplanlgqvb/chart.png
Bharti Airtel's shares have outperformed the broader market https://www.reuters.com/graphics/BRV-BRV/dwvklxzrzpm/chart.png
Global investors bought one third of Jio Platforms in 2020 https://www.reuters.com/graphics/BRV-BRV/lbvgzkljqpq/chart.png
(Editing by Una Galani; Production by Aditya Srivastav)
((For previous columns by the author, Reuters customers can click on BOSE/[email protected]))
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