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This Article is From Jul 12, 2021

RBI Permits SFBs To Merge With Holding Companies - Unlock Significant Value For Equitas: Motilal Oswal

RBI Permits SFBs To Merge With Holding Companies - Unlock Significant Value For Equitas: Motilal Oswal
A person hands over India rupee banknotes at a cash counter. (Photographer: Dhiraj Singh/Bloomberg)  

BQ Blue's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer BloombergQuint's subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

The Reserve Bank of India has allowed small finance banks and respective holding companies to apply for the amalgamation scheme.

Both Equitas Holdings Ltd. and Ujjivan Financial Services Ltd. are going to complete five years of business operations.

Though the SFBS are required to dilute promoter shareholding to less than 40% within five years, but this scheme of amalgamation will give an exit route to the promoters and collapse the holding company structure.

Equitas and Ujjivan holding company currently owns ~82%/~83% stake in underlying SFB respectively.

Both the entities are completing five years on September 04, 2021 and January 31, 2022 respectively.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BloombergQuint.

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