Anil Ambani may venture into Investment Banking

During January-May 2007, total equity deals stuck by Indian corporates amounted to $50billion, an all time record. Buoyed by this and increasing offshore deals and fund raising activities, ADAG’s Reliance Capital is planning to foray into investment banking and merchant banking advisory services to further enhance its financial services portfolio.

Investment bankers act as advisors, financiers and brokers to such deals earning a hefty commission. Reliance Capital may team up with a foreign firm with no Indian presence. R-Cap would provide local market knowledge while the latter would bring technical expertise.

Reliance Capital has been scaling its financial services recently. It has the largest Mutual Fund house in India and seen tremendous growth in its life and general insurance businesses. It has also started a brokerage firm, Reliance Money with huge distribution network of 2,300 outlets and is going to soon start its consumer finance business.

The move may work well for Reliance Capital as it is known to have a wide portfolio of investments across sectors in different companies though the ADAG listed companies and Reliance Mutual Fund. The investment management business of these companies itself will be a huge opportunity for Reliance Capital.

Sensing from the amount of hectic activities in Reliance Capital, we could expect to see the company venturing into housing finance, credit cards, auto loans and maybe even a banking entity.