Shares of Reliance Capital surged by 4 per cent on the bourses today after

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the company said it has received in-principle approval from insurance sector regulator IRDA for its proposed 26 per cent stake sale in Reliance Life Insurance to Japan's Nippon Life.

After starting the day on a positive note, the stock jumped by 3.69 per cent to a high of Rs 417 on the Bombay Stock Exchange.

A similar trend was seen on the National Stock Exchange, where the stock rose by 4 per cent to an early high of Rs 417.70.

However, the stock later pared some of the gains and was trading 1.13 per cent higher at Rs 406.70 at 1100 hours on the BSE.

The company has received in-principle approval from the Insurance Regulatory Development Authority (IRDA) and final approval for the proposed sale would be granted upon receipt of RBI consent, Reliance Capital said in a statement.

Earlier this year, Nippon Life signed a definitive agreement for acquiring a 26 per cent stake in Reliance Life Insurance for Rs 3,062 crore.

Meanwhile, in volatile trade, the BSE Sensex was down by 60.90 points at 16,406.54 at 1100 hours today.