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ETMarkets.com Mumbai: Axis Bank has begun revaluing its non-banking finance arm, Axis Finance, after the Reserve Bank of India (RBI) eased curbs on the business overlap between banks and their group entities, two people familiar with the matter told ET. Easing of these restrictions would allow better valuations for group businesses majority-owned by the bank.Axis Bank now plans to sell more than 26% of the subsidiary, up from the 20% stake it had initially intended to offload.Earlier, the lender had targeted a valuation of $1-1.5 billion for Axis Finance. It received two bids from private equity investors at the end of September, but is expected to invite fresh expressions of interest once the revaluation exercise is complete."Business prospects for Axis Finance have improved substantially, given that banks can now route more of their businesses through their NBFCs," said one of the sources cited above. "In light of this, the lender could seek a valuation north of $2 billion. The idea is to sell a 26% stake to a PE investor and then pursue an IPO three to four years down the line."Axis Bank did not respond to ET's query.Live EventsIn its October 6 policy, the RBI announced plans to withdraw the proposed prohibition on overlapping lending activity between banks and their group entities-a move that removes a key regulatory overhang for lenders with NBFC subsidiaries engaged in similar lines of business.Strategic InvestorThe bank is exploring a strategic sale of a stake in Axis Finance to private equity investors, followed by a potential public listing of the NBFC at a later stage."We are going through a process; hopefully, the final business circular is not far away, so we will find out what leeway and flexibility we have," Axis Bank MD & CEO Amitabh Chaudhry said on October 15. "Axis Finance is growing quite well and needs capital. It will become an upper-layer NBFC very soon given the size of its AUM, which means we'll be on the path to list it at some stage in the future."Axis Finance had assets under management of ₹43,012 crore at the end of September 2025, with a gross NPA ratio of 1%.Add as a Reliable and Trusted News Source Add Now! (You can now subscribe to our Economic Times WhatsApp channel) Read More News onaxis bankAxis BankAxis FinanceReserve Bank of Indiavaluationprivate equity investorsregulatory changesIPOassets under management (Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online....moreless (You can now subscribe to our Economic Times WhatsApp channel)Read More News onaxis bankAxis BankAxis FinanceReserve Bank of Indiavaluationprivate equity investorsregulatory changesIPOassets under management(Catch all the Business News, Breaking News and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online....moreless
