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Aditya Birla Capital

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Aditya Birla Capital Limited
Public company
Traded asBSE540691, NSEABCAPITAL
Founded2007; 12 years ago (2007) (As Aditya Birla Financial Services)
Headquarters,
India
Area served
India
Key people
Kumar Mangalam Birla
(Chairman), Ajay Srinivasan
(Chief Executive)
ProductsFinancial Services
RevenueIncrease560.8 billion (US$7.8 billion) (2017)[1]
Increase 560.8 billion (US$7.8 billion) (2017)
Total assetsIncrease 7.813 trillion (US$110 billion) (2017)[2]
ParentGrasim Industries
Websitewww.adityabirlacapital.com

Aditya Birla Capital Limited (ABCL) is the holding company for all financial service businesses of the Aditya Birla Group and is a Non-Banking Financial Institution (NBFC).[3]

The company is a subsidiary of Grasim Industries and manages assets worth 2.46 trillion (US$34 billion) and had over 12,000 employees as of March, 2017.[4] Through various subsidiaries, Aditya Birla Capital is in the business of life insurance, asset management, private equity, corporate finance, structured finance, insurance broking, wealth management, equity broking, currency broking, commodity broking, financial advisory services, housing finance, pension fund management and health insurance.[5]

History[edit | edit source]

Aditya Birla Group got into the financial service business with a Non-bank financial institution called Birla Growth Fund in 1986 (later renamed Birla Global Finance Limited in 1994).[6] In 2005, the group decided to consolidate its business and as part of this exercise, it merged Birla Global Finance Limited into Aditya Birla Nuvo.[7] At the time of the merger, Birla Global Finance had assets worth approximately INR 160 billion under its management.[8] Aditya Birla Capital (incorporated as Aditya Birla Financial Services Limited in 2007 as a 100% subsidiary of Aditya Birla Nuvo) subsequently became the holding company for financial service businesses of the group.[9][10] In 2017, Aditya Birla Financial Services was renamed Aditya Birla Capital.[11]

Products and Services[edit | edit source]

Products and services offered by the company include life insurance, asset management, private equity, corporate finance, structured finance, insurance broking, wealth management, equity broking, currency broking, commodity broking, financial advisory services, housing loans, pension fund management and health insurance.

Aditya Birla Capital got into the insurance sector in India after the government allowed entry of private companies in the sector.[12] In 2001, Birla Sun Life Insurance Company Limited was founded as a joint venture between Aditya Birla Group and Sun Life Financial of Canada with Aditya Birla Nuvo (then Indian Rayon) and Birla Global Finance together holding 74% of the company's equity shares and Sun Life Financial holding 26%.[13][14] In 2016, Sun Life Financial had increased its shareholding to 49% in Birla Sun Life Insurance and Aditya Birla Group continued to have 51% controlling stake.[15] As of 2016, the company had approximately 400 branches across India and approximately 57,000 agents.[16]

In 2016, Aditya Birla Capital launched Aditya Birla Health Insurance Company, a standalone health insurance provider in India. The company is a joint venture with Aditya Birla Capital holding 51% of the company and MMI Holdings of South Africa holding the remaining 49%.[17] As of 2017, the company had 60 branches spread across 34 cities in India.[18]

Aditya Birla Group set up Birla Sun Life Asset Management to enter the mutual fund business as an equal joint venture with Sun Life Financial of Canada in 1994. In 2012, Aditya Birla Nuvo acquired an additional 1% stake in the company making it a subsidiary, with Sun Life Financial holding 49% in the venture.[19] In 2014, the mutual fund crossed INR 1 trillion in assets under its management. It is the fourth largest mutual fund in India.[20] In the same year, Birla Sun Life Mutual Fund bought out ING Mutual Fund, the Indian mutual fund business of ING Group.[21] In 2017, the company added the prefix "Aditya" and became Aditya Birla Sun Life Mutual Fund.[22]

In 2009, Aditya Birla Capital acquired a controlling stake Apollo Sindhoori Capital Investments, a securities broking firm. The company was later renamed Aditya Birla Money.[23] Aditya Birla Capital decided to get into the Mortgage loan sector in 2015.[24]

In the year 1986, Aditya Birla Group incorporated Birla Growth Fund.[6] The company operated four divisions; Capital Market, Corporate Finance, Retail Finance and General Insurance Advisory. In the year 1994, the company changed its name from Birla Growth Fund Limited to Birla Global Finance Limited and the company was listed on The National Stock Exchange and Bombay Stock Exchange.[25] In 2006, the company was delisted from Bombay stock exchange after its amalgamation with Aditya Birla Nuvo.[7] In 2010, the company was renamed Aditya Birla Finance Limited.[26]

The company runs a private equity business under the name Aditya Birla Private Equity.[27] In 2017, Aditya Birla Capital received a license to set up an asset reconstruction company.[28]

Restructuring and Rebranding[edit | edit source]

The Aditya Birla Group announced a plan to restructure its business in 2016. As part of this plan, it was announced that the financial services business would be listed as a separate entity on stock exchanges. In September 2017, Aditya Birla Financial Services was restructured as Aditya Birla Capital Limited listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) after demerging from its parent entity, Grasim Industries (Aditya Birla Nuvo merged into Grasim Industries prior to the Aditya Birla Capital demerger).[29][30][31]

In 2017, all financial services of the Aditya Birla Group came under one brand, Aditya Birla Capital.[32] The company came out with a strategy of a single brand, single point of contact for clients and focus on money in general in place of individual products.[33]

References[edit | edit source]

  1. "Aditya Birla Capital Profit & Loss account, Aditya Birla Capital Financial Statement & Accounts". Retrieved 28 March 2018.
  2. "Aditya Birla Capital Balance Sheet, Aditya Birla Capital Financial Statement & Accounts". Retrieved 28 March 2018.
  3. "Aditya Birla Capital Information - The Economic Times". economictimes.indiatimes.com. The Economic Times. Retrieved 4 March 2018.
  4. "Shares of Aditya Birla Capital tank 5% after listing - Times of India". The Times of India. Retrieved 4 March 2018.
  5. "Aditya Birla Capital to be listed on Friday". The Hindu Businessline. Retrieved 4 March 2018.
  6. 6.0 6.1 Sanjai, P.R. (12 August 2016). "The rise of Aditya Birla Financial Services". livemint.
  7. 7.0 7.1 "Indo Gulf, Birla Global to merge into Indian Rayon Swap ratio at 3:1; new company to be called Aditya Birla Nuvo". The Hindu Business Line. 12 September 2005. Retrieved 15 October 2017.
  8. "The Hindu : National : Indo Gulf, Birla Global merge with Indian Rayon". The Hindu. 12 September 2005. Retrieved 15 October 2017.
  9. "Birla group in mega merger". www.rediff.com. 12 September 2005. Retrieved 28 March 2018.
  10. Majumdar, Sourav; Panchal, Salil. "Making the money business work at Birla". Forbes India. Retrieved 15 October 2017.
  11. "A CEO of CEOs". Rediff. Retrieved 15 October 2017.
  12. "FDI Limit in Insurance sector increased from 26% to 49%". The Biharprabha News. IANS. 10 July 2014. Retrieved 4 March 2018.
  13. Palande, P. S.; Shah, R. S.; Lunawat, M. L. (2003). Insurance in India: Changing Policies and Emerging Opportunities. SAGE Publications. p. 450. ISBN 9780761997474. Retrieved 4 March 2018.
  14. "rediff.com: Birla Sun Life insurance launched". Rediff. 29 January 2001. Retrieved 4 March 2018.
  15. Sanjai, P.R. (2 December 2015). "Sun Life Financial to increase its stake in Birla Sun Life Insurance from 26% to 49%". livemint. Retrieved 4 March 2018.
  16. Sinha, Shilpy (13 June 2016). "Downsizing helps Birla Sun Life boost its new business income". The Economic Times. Retrieved 4 March 2018.
  17. "Aditya Birla Financial diversifies into health insurance with ABHICL". The Economic Times. PTI. 25 November 2016. Retrieved 4 March 2018.
  18. Gupta, Sanjay (22 October 2017). "Aditya Birla Health Insurance targeting young Indians through its digital strategy". livemint. Retrieved 4 March 2018.
  19. Chatterjee, Dev (7 November 2012). "Birlas take control of mutual fund venture with Sun Life". Business Standard India. Retrieved 4 March 2018.
  20. Kant, Chandan Kishore (2 October 2014). "Birla Sun Life MF joins Rs 1 lakh-cr club". Business Standard India. Retrieved 4 March 2018.
  21. "Birla Sun Life MF acquires ING's Indian assets". Business Standard India. 15 May 2014. Retrieved 4 March 2018.
  22. "Birla Sun Life MF to perfix 'Aditya' for all legal entities, scheme names". Moneycontrol. 17 August 2017. Retrieved 4 March 2018.
  23. "Apollo Sindhoori Capital is now Aditya Birla Money". The Economic Times. PTI. 16 November 2009. Retrieved 4 March 2018.
  24. Majumdar, Sourav. "Aditya Birla Group readies mega Housing Finance Foray". Forbes India. Retrieved 4 March 2018.
  25. Nayak, Amar (2011). Indian Multinationals: The Dynamics of Explosive Growth in a Developing Country Context. Springer. p. 140. ISBN 9780230308718. Retrieved 4 March 2018.
  26. "Birla Global Finance is now Aditya Birla Finance". Business Standard India. 5 February 2010. Retrieved 4 March 2018.
  27. Balakrishnan, Reghu (4 June 2015). "Aditya Birla Private Equity said to be looking to raise $500 mn fund". livemint. Retrieved 4 March 2018.
  28. Susmit, Sneh (25 September 2017). "Aditya Birla Capital gets RBI approval for asset reconstruction firm". livemint. Retrieved 4 March 2018.
  29. "Grasim to issue 15 shares for every 10 AB Nuvo shares". Moneycontrol. 6 October 2016. Retrieved 4 March 2018.
  30. "NCLT pproves ABNL-Grasim merger; ABFSL to list soon". The Free Press Journal. 6 June 2017. Retrieved 4 March 2018.
  31. "Aditya Birla Capital lists at Rs 250 after demerger with Grasim, cracks 5%". The Economic Times. 2 September 2017. Retrieved 4 March 2018.
  32. "Aditya Birla Capital shares make exchange debut; list at Rs 250, without IPO". The Financial Express. 1 September 2017. Retrieved 28 March 2018.
  33. Balakrishnan, Ravi. "Will Aditya Birla Capital's latest gambit deliver? - ET BrandEquity". ETBrandEquity.com. Retrieved 28 March 2018.


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