Reliance Capital Ltd shares witnessed huge swing on Tuesday, August 13, as the stock price declined over 8% in afternoon trade after rising 5% in morning session, after a media report said that the company may sell a majority stake in its subsidiary Reliance Home Finance Ltd.
At 3:10 pm, the Reliance Capital stock was trading lower by 6% at Rs 45.80 compared with its previous close of Rs 48.75. The stock touched an intra-day high of Rs 51.15 and intra-day low of Rs 44.85.
A report by Mint said that Reliance Capital was in talks with investment firms Varde Partners Inc., AION Capital, Cerberus Capital Management and NBFC Altico Capital India for stake sale in Reliance Home Finance.
Reliance Home Finance is reportedly looking to wind down its book and focus on the retail segment. The company has a loan book of Rs 11,000 crore which includes Rs 4,500 crore of retail loans and Rs 6,500 crore of wholesale loans, the report said.
Meanwhile, a separate report by Economic Times said that Reliance Capital was all set to file a Rs 10,000 crore defamation suit against its erstwhile auditor, Price Waterhouse and Co (PwC). Separately, some shareholders of the Reliance Group companies are also expected to file a class action suit against PwC for eroding value of their investment, added the report.
Reliance Capital had last week told stock exchanges that it had taken opinions of two law firms, independent lawyers and joint auditors, and found there was no merit in allegations levelled by PwC.
Price Waterhouse and Co., a network firm of PwC India, had resigned as auditor of Reliance Capital and Reliance Home Finance in June saying that it did not receive satisfactory responses to its request for additional information from the companies.
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