According to sources, both the bidders have made it clear to the Committee of Creditors (CoC) that unless the issues raised by them are duly resolved to their complete satisfaction, they are unlikely to participate in the second round of auction.

New guidelines in the works may include more qualified buyers which can deepen the market.

"The companies are engaged in preliminary discussions to explore potential strategic options including potential combination and listing of the retail mortgage portfolio of JM Financial and the home finance business of Indostar Home Finance Private Limited including other mortgage-backed business of Indostar," JM Financial said in a regulatory filing to stock exchanges.

Non-bank lenders JM Financial and Indostar on Monday announced that they are in "preliminary discussions" to merge their respective mortgage verticals into a single entity.

The Reserve Bank of India (RBI) on November 29, 2021, superseded the board of Reliance Capital in view of payment defaults and serious governance issues. The RBI appointed Nageswara Rao Y as the administrator in relation to the Corporate Insolvency Resolution Process (CIRP) of the firm.

Subsidiaries, Tata Capital Financial Services and Tata Cleantech will merge with Tata Capital, top executives close to the group said. Tata Housing Finance will be housed separately under the holding company.

Torrent Investments and Oaktree Capital didn't submit bids, although they had indicated earlier that they would participate in the process, the people said.

Although Reliance Capital's (RCap) lenders succeeded in concluding the second auction with an improved offer, they will have to cross several hurdles before completing the sale of the Anil Ambani financial services company as part of the insolvency process.

The rise in net profit was buoyed by improvement in asset quality and business expansion. Net interest income rose 39% at Rs 251 crore.