"Hinduja Targets $35-40 Billion Value Creation in BFSI Sector by 2030"

The Hinduja Group is making a substantial bet on the Banking, Financial Services, and Insurance (BFSI) sector, with an ambitious target to create a value of USD 35-40 billion within the next five to seven years. Ashok P Hinduja, Chairman of Group Companies (India), shared this strategic vision during a media roundtable, highlighting the group's intention to expand its presence in the BFSI sector and enhance its offerings.

In addition to its existing interests in mobility and energy sectors, the Hinduja family-owned conglomerate now views BFSI as a driving force for the upcoming decade. The group, which already owns IndusInd Bank, Hinduja Leyland Finance, and Hinduja Bank (Switzerland), is embarking on a journey of diversification and expansion, focusing on new technologies, digital innovations, and fintech as integral components of its growth strategy. The group aims to address gaps through acquisitions, aiming to offer a comprehensive suite of BFSI services.

Ashok Hinduja, aged 73, outlined the group's approach: "The first phase will begin, and the objective of the holding structure, which is a Mauritius-based IndusInd International, is to expand into the BFSI sector to offer a complete solution." The group is also in the process of increasing its promoter's stake in IndusInd Bank, following the RBI's policy modification that allows promoters of private banks to hold up to 26 percent.

Furthermore, the group is confident about acquiring the debt-ridden Reliance Capital by the end of November. This acquisition will expand the group's presence in various BFSI segments, including life insurance, general insurance, health insurance, asset reconstruction, and stockbroking. Hinduja revealed, "So that will cover part of it, the balance left out is the mutual fund, wealth management, which we are also on the lookout for. Hopefully, by the end of this financial year, mostly 95 percent of the BFSI sector will be covered."

The group's ambitious vision for the BFSI sector is clear, targeting a value creation ranging between USD 35 to 40 billion. When discussing the timeframe, Ashok Hinduja suggested a minimum of five to seven years, with each entity within the group having its own board to provide perspective and direction.

Hinduja emphasized that once Reliance Capital is acquired, it will remain a separate entity, with different operating entities under the common parent. This includes the group's existing ventures in life insurance, general insurance, and health insurance. These endeavors are expected to result in IPOs within two to three years.

The Hinduja Group's subsidiary, IndusInd International Holdings Ltd (IIHL), has emerged as the sole bidder for Reliance Capital, currently entangled in a legal battle with Torrent Investments over the acquisition. The matter is currently before the Supreme Court, where Torrent Investments is seeking a stay on the approval of the resolution plan submitted by the Hinduja Group.

In addition to these endeavors, the group is actively exploring opportunities in mutual funds and is actively considering acquisitions to bolster its presence in this sector. Ashok Hinduja concluded by noting that the market is expansive, with ample room for multiple players to thrive.

With regards to the increased stake in IndusInd Bank, Hinduja acknowledged the recent policy change by the Reserve Bank of India (RBI) allowing private bank promoters to hold up to 26 percent stake in banks. The group has already commenced capital raising efforts and is set to complete its first phase on November 15.

BS