Mukesh's RIL may market financial products of Anil
Mukesh Ambani is all set to enter the financial sector, hitherto considered a domain of Anil Ambani, and chances are that his group would showcase the products of the younger brother as also other players.business Updated: Jul 04, 2010 18:47 IST
Mukesh Ambani is all set to enter the financial sector, hitherto considered a domain of Anil Ambani, and chances are that his group would showcase the products of the younger brother as also other players.
The Mukesh Ambani group is contemplating a foray into financial services distribution business, using its vast network of retail chain to sell products like insurance, mutual fund and forex of different players from India and abroad.
Mukesh Ambani-led Reliance Industries' spokespersons did not respond to e-mailed queries, including whether the group was in talks with domestic and foreign financial sector players like DE Shaw, JM Financial and Warren Buffett-led Berkshire Hathaway.
Legendary American investor and one of the world's richest persons Buffett is also said to be exploring an entry into Indian financial services distribution business and is slated to visit India early next year.
Reliance Industries has already set up a few subsidiaries for financial services business, namely Reliance Retail Finance Ltd, Reliance Retail Insurance Broking Ltd, Reliance Financial Distribution and Advisory Services Ltd and Reliance Retail Travel and Forex Services Ltd.
Together, these entities had assets worth close to Rs 125 crore as on March 31, 2010.
Anil Ambani group is already present in a host of financial services businesses, including insurance, mutual funds, brokerage and non-banking financial services. While it is also present in distribution business through Reliance Money, this entity is in the process of shifting the focus more towards services like investment banking and brokerage.
The issue of cooperation in this sector is believed to have been discussed between the two brothers during their stay at Kruger National Park in South Africa last month, with Anil looking at leveraging from network of Reliance Retail, which has already over 1,000 stores and there are plans for manifold increase.
Industry sources said that it was a part of this commitment that Mukesh and Anil Ambani would not compete directly, at least in the initial phase of elder brother's entry, in the financial business and would rather look at complementing their businesses.
Even before their separation, Anil was considered the expert on financial matters and Mukesh has a reputation of rolling out businesses of unheard of size. While Mukesh is credited with creating the world's largest refinery, Anil raised Rs 11,500 crore through Reliance Power IPO - the biggest in India till date.
The talks for Mukesh Ambani group's entry into financial services business is being seen as one of the follow-ups to a truce deal on May 23 that also scrapped a five-year old non-compete agreement between the brothers.
Even as they scrapped their non-compete agreement, the two groups had said at that time that they were "hopeful and confident of creating overall environment of harmony, cooperation and collaboration" between them.
First Published: Jul 04, 2010 18:44 IST