Shares of Religare Enterprises Ltd (REL) declined 6% on 16 February after the Burman family-backed company approved a plan to demerge its financial services and insurance businesses into two separately listed entities to unlock shareholder value and sharpen strategic focus.

REL described the move as its first major restructuring since the Burman family acquired control of the company in February 2025.

Under the proposed scheme of arrangement, REL will retain its stake in Care Health Insurance Ltd, which will continue to operate as a pure-play insurance entity. The company will transfer its financial services business, including lending, broking, investment operations, and related support services, on a going-concern basis to its subsidiary, Religare Finvest Ltd (RFL).

The company added, “As part of the demerger consideration, RFL will issue fully paid-up equity shares to shareholders of REL on a 1:1 mirror basis. Post-demerger, RFL will be listed on BSE and NSE with mirror image shareholding as REL.”

REL said the restructuring will streamline operations by creating two independent businesses, enabling each to pursue sector-specific growth strategies and opportunities.

The company will implement the transaction through a scheme of arrangement to be filed with the National Company Law Tribunal, subject to statutory and regulatory approvals, including those from shareholders and creditors.

REL aims to complete the demerger process and list RFL by the first quarter of FY28.

The company added that the transition will not disrupt business operations and will not affect employees, customers, or partners.

REL expects the demerger to enhance governance and oversight while allowing management teams to focus more sharply on the objectives and performance of their respective businesses.

Chief Financial Officer Pratul Gupta said the transaction will broaden the investor base, simplify the corporate structure, and create two well-capitalised platforms capable of independently pursuing their strategic ambitions. He added that the transformation will position both entities as leaders in their respective segments, equipped with the resources and flexibility to capture future growth opportunities.

At 12:39 pm, the shares of Religare Enterprises were trading 5.35% lower at Rs 230.95 on NSE.

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