Two reasons why Reliance Capital shares are up in a flat market

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Reuters[/caption]

Reliance Capital Ltd shares rose as much as 3.4 percent on Wednesday after the Economic Times reported the company has agreed to sell stakes of just under 5 percent in its consumer lending unit to two Japanese firms, citing unidentified sources.

The newspaper reported that Reliance Capital plans to spin off its consumer lending business into a new unit and sell the minority stakes to Sumitomo Mitsui Trust bank and Nippon Life Insurance, citing two people familiar with the development.

According to the report, Reliance Capital and its two Japanese partners, who have signed an MoU, will apply for a banking licence by July 1, the deadline set by the RBI.

Reuters