Mumbai, Sept. 4: The listed companies belonging to the Anil Ambani group are mulling qualified institutional placements (QIP), indicating the conglomerate’s reliance on equity to fund expansion and strengthen its financial position.

Reliance Capital, Reliance Infrastructure, Reliance Power, Reliance MediaWorks and Reliance Broadcast Network Ltd are contemplating placements to qualified institutional buyers (QIBs) for which they will take shareholders’ approval at their upcoming annual general meetings. Reliance Communications (R-Com), too, is mulling a similar issue.

QIP is a private placement of equity shares, or securities convertible into equity shares, by a listed company to qualified institutional buyers.

QIBs include foreign institutional investors, banks, financial institutions and mutual funds.

The QIP issues indicate that the Anil D. Ambani group is relying less on debt and more on equity at a time interest rates are high.

Reliance Power (RPower) has a planned portfolio of 35,000 megawatt of power generation capacity. In its annual report, the company informed its shareholders that a QIP issue was being proposed to strengthen its financial position to partially fund such a large capacity. RPower also plans to raise cash through the issue of securities in international markets.

RPower is developing three large power projects — at Sasan in Madhya Pradesh (3,960MW), Krishnapatnam in Andhra Pradesh (4,000MW), and Tilaiya in Jharkhand (3,960MW). On September 2, the company got a Rs 400-crore loan from the US Export-Import Bank for a 40MW solar plant being set up in Rajasthan.

RPower and R-Com are not the only two that are contemplating both QIP and overseas issues. Reliance Infrastructure is looking to raise up to Rs 5,000 crore via an enabling resolution from the international markets to implement projects in power generation, transmission and distribution and infrastructure development such as highways, airports and other mass rapid transit systems.

Reliance Broadcast Network Ltd — the entertainment company with a presence in radio and television — plans to raise up to Rs 1,000 crore to bid for more FM licences when a tender is rolled by the ministry of information and broadcasting in phase III of FM licensing.

Analysts have expressed concern that R-Com’s net debt of Rs 32,000 crore is impacting its stock. Experts do not rule out the possibility of part of the QIP proceeds being used to pare debt at the group level.

The fund-raising plans come at a time the group stocks are under pressure on the bourses.

There have been other setbacks as well. In August, both R-Com and Reliance Infrastructure were removed from the Sensex.

The R-Com share, which was ruling at Rs 147.90 on January 3, is now worth Rs 84.45 on the Bombay Stock Exchange; Reliance Infrastructure, which finished at Rs 862.50 at the beginning of this year, ended at Rs 451.60 last Friday; while Reliance Capital, which closed at Rs 681.75 in the beginning of the year, is now at Rs 406.65.

Last week, Anil’s Reliance Capital had signed a deal with Japan’s Nippon Life for selling stakes in its asset management arm and other businesses to the Tokyo-based company.

Nippon Life had bought a 26 per cent stake in Reliance Life for Rs 3,062 crore, or $680 million, valuing Reliance Capital’s life insurance business at $2.6 billion.