RCap would work to grow its Nippon's investments portfolio in India and help the Japanese company make and manage sizeable and meaningful investments in India in near term
New Delhi: After bringing in Nippon Life as strategic partner in its life insurance and asset management businesses, Reliance Capital (RCap) is now looking to expand further this partnership and would help the Japanese financial services giant bring part of its $600 billion assets under management to India, reports PTI.
RCap, the financial services arm of Anil Ambani-led Reliance Group, last week completed its 26% stake sale in its mutual fund and asset management unit Reliance Capital Asset Management Company (RCAM) for Rs1,450 crore to Nippon Life.
Previously R-Cap has sold a 26% stake in its life insurance venture Reliance Life for Rs3,062 crore to Nippon Life.
With the completion of both the deals, which figure among India's biggest ever foreign direct investments (FDIs) in their respective sectors, R-Cap CEO Sam Ghosh told PTI that the company would look at further expanding its partnership with Nippon Life.
"Nippon Life have $600 billion (Rs30 lakh crore) of assets, but a very small part of that is currently invested in India. There are two-three areas where Reliance Capital could look at working together with the Japanese financial services giant," Ghosh said in a telephonic interview.
Reliance Capital would look at getting get part of Nippon's asset under management (AUM) to India, he said, while adding that the Japanese behemoth has minimal investments here despite having more than $600 billion AUM globally.
He said that RCap would work to grow its Nippon's investments portfolio in India and help Nippon make and manage sizeable and meaningful investments in India in near term.
Ghosh asserted that Nippon Life has demonstrated strong confidence in India, and Reliance Group, by investing over Rs4,500 crore in a short span of 12 months and R-Cap now looking forward to strengthening this partnership further.
Listing out the areas where the two groups can work together, Ghosh said: "We can manage part of their funds for investment in India and then we can help bring some of Nippon Life's assets as investments in India."
"Since they are a partner now, the focus will be to get a sizeable part of their assets to India. We will assist in their portfolio investment in India."
Ghosh said that Nippon Life's move to invest Rs4,500 crore as FDI in two of Reliance Capital's businesses (life insurance and asset management) shows their commitment to India, especially at a time when there is a perception about the sentiments being very conducive for foreign investments.
"Nippon Life has shown that they see a very good potential in India," he said.
Earlier in an emailed interview, Nippon Life Insurance President Yoshinobu Tsutsui had said that India is a growing market and the group sees strong growth potential in the long term.
"When I say long-term, we don't look at short-term fracturation of the market, due to the currency and the short-term spilling down of the economy. Because we are a life insurance company and we invest from long-term perspective," he had said.
"For Nippon Life, the population in India, the demographic percentage of the young population and the rising GDP make India a very attractive destination," Tsutsui said.
Ghosh said that the proceeds from 26% stake sale in RCAM will be used to reduce the debt of Reliance Capital, among other purposes.
RCAM is India's largest and most profitable AMC and manages approximately Rs1.40 lakh crore ($28 billion), across mutual funds, government sponsored public funds, managed accounts and hedge funds.
When asked whether Reliance Capital will also look at stake sales in other businesses such as general insurance, Ghosh declined to comment.