Billionaire brothers Malvinder Mohan Singh and Shivinder Mohan Singh directly and through holding companies RHC Holding and RHC Finance own 50.89% in Religare. About 87.8% of this holding has been pledged with lenders. The steep fall in prices could put pressure on lenders holding these shares.
A Religare spokesperson said, “Please note that no lenders have sold or are selling any shares of Religare (REL) pledged by the Promoters. As you know prices are determined by demand and supply and other market dynamics.”
The financial services firm has been divesting key assets to focus on core businesses.
Over the past year or so, it has sold its interests in several businesses such as life insurance, asset management and wealth management. It is currently in the process of getting approvals for its proposed sale of its health insurance business. It is also in the middle of a restructuring process where it is separating its broking business and merging other subsidiaries with itself.
But, the big write-offs in its lending arm Religare Finvest (RFL) has been dragging the financials. Last month, it reported a loss of Rs 157 crore for the financial year ended March 2017.
“As the dues were not paid by SCCPL in spite of regular follow-ups, the SBLC was invoked. However, the SBLC has not been honoured and payment has not been received by RFL yet. Hence, the legal proceedings have been initiated against SCCPL for recovery of the amounts due. Considering the non-receipt of the BPC and other developments, RFL has written off the entire amount of Rs 51,991.51 lacs in the Profit and Loss account. Further, an amount of Rs 27,375.68 lacs standing overdue in two accounts related to the same assignment transaction has also been written-off,” Religare said in the note to accounts.