As stocks get hammered, Anil Ambani’s Reliance Capital has shifted focus from boosting topline to growing bottomline and increasing transparency. Rel General Insurance which was incurring heavy losses till last quarter (Q1FY09) turned profitable in Q2. Rel Consumer Finance whose loan book grew significantly Q after Q till FY08 has slowed down disbursements subsequently. What’s more, it has put a brake on fresh lending signalling a move towards containing NPL’s in this liquidity crunch environment. In addition to profitability, the transparency level has increased a bit by organising Concall for the first time ever in Q2, consolidating Rel Money accounts with the parent though life insurance business is excluded from consolidation as it continues to bleed. It would have been better had Anil Ambani focussed on profitability and transparency before the market crash so that the extent of fall in the company’s stock price would not have been so severe. No wonder then Institutional holding is less than 4% while retail investors share is around 18% of the total outstanding shares.
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