Religare Enterprises to separate financial services, insurance businesses, list Finvest

Mumbai: Religare Enterprises Ltd and Religare Finvest Ltd have approved to spin off the group’s financial services and insurance businesses into two independent, listed entities.

“Following the evaluation of various structural alternatives with leading advisors, the boards of Religare Enterprises and Religare Finvest determined that the proposed demerger represents the most efficient path to create focused platforms with enhanced governance and strategic flexibility,” the companies said in a release.

Religare Enterprises will retain its stake in Care Health Insurance. The financial services business, comprising lending, broking, investment and ancillary and support services, will be transferred to Religare Finvest “on a going concern basis”.

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Religare Finvest will issue one fully paid-up equity share to shareholders for every share held in Religare Enterprises (1:1). Religare Finvest will be listed on the BSE Ltd and the National Stock Exchange, with its shareholding pattern mirroring Religare Enterprises’ current ownership. As of 31 December, the promoter group—the Burman family—held 26.3% in Religare Enterprises.

Religare Enterprises’ shares will be in focus on Monday, 16 February as the announcement was made on Saturday. On Friday, the stock had closed 3.54% lower at ₹243.50 on the NSE.

The demerger will be implemented through a scheme of arrangement, which will need to be filed with and approved by the National Company Law Tribunal, and will be subject to other statutory and regulatory approvals. The group aims to complete the process and list Religare Finvest in the first quarter of FY28.

Shareholder value, management attention

The demerger is aimed at streamlining the businesses, unlocking value in the financial services business for shareholders, and pursuing distinct growth opportunities, the release said.

“We are simplifying our corporate structure to create two focused, well-capitalised and agile entities with distinct mandates,” Pratul Gupta, chief financial officer of Religare Enterprises, said. Each entity will benefit from improved capital allocation efficiency, enhanced transparency for investors, and the ability to optimise its capital structure based on business characteristics and growth requirements.

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“We are confident that this transformation will establish both entities as leaders in their respective domains, each with the resources, focus, and flexibility to capitalise on significant growth opportunities ahead.”

Religare Enterprises is a diversified financial services group which operates through its subsidiaries to offer small and medium enterprise (SME) loans, affordable housing finance, health insurance and retail broking to mass retail and affluent customers, SMEs and mid-sized corporates. The company services over 1.1 million customers across 1,275 locations in 400 cities.

A subsidiary of Religare Enterprises, Religare Finvest lends primarily to SMEs and has a network of 25 branches across the country.

Care Health Insurance offers retail health plans, top-up, personal accident, maternity, international travel, and critical illness insurance. It also offers group health insurance and personal accident insurance for corporates, micro-insurance products for the rural market as well as wellness services.

“There will be no interruption to business operations and no impact on employees, customers, or partners during the implementation period,” the release said, adding that Religare Enterprises and its operating subsidiaries remain committed to ensuring operational continuity and a seamless transition.

Religare Finvest was under the Reserve Bank of India’s corrective action plan (CAP) restrictions since 18 January 2018 after the central bank observed irregularities during inspection of the company’s position as on 31 March 2017. The restrictions were removed on 23 July 2025, following the company’s compliance with the CAP conditions and changes in its management and directors.

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In February 2025, the Burman family of the Dabur Group secured control of Religare Enterprises through its investment entities—MB Finmart, Puran Associates, Milky Investment and Trading Company, and Vic Enterprises—taking its total shareholding in the company to 25.2%. The promoter group had then said that the priority is to instil stability, strengthen governance, and drive sustainable growth at the company and maximize stakeholder value.