IIFCLs $1-bn infra debt fund by next month

In what could prove to be a boost for the lagging core sector,state-owned India Infrastructure Finance Company Ltd is expected to launch a $1-billion infrastructure debt fund by next month

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In what could prove to be a boost for the lagging core sector,state-owned India Infrastructure Finance Company Ltd (IIFCL) is expected to launch a $1-billion infrastructure debt fund (IDF) by next month.

We will launch the IDF as soon as we get final approval from market regulator Sebi and it should be operational by May. The fund would have a corpus of $1 billion of which Rs 1,500 crore would come through the mutual fund route, SK Goel,CMD,IIFCL said on Wednesday. Setting up an IDF through the mutual fund route provides more flexibility,he explained.

Domestic investors including IIFCL,IDBI Bank and LIC would pool in $500 million into the fund while foreign investors would provide the balance,Goel said. Asian Development Bank has already committed $200 million,while Barclays and HSBC are likely to bring in $150 million each.

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Meanwhile,the infrastructure lender reported a 105 per cent increase in its net profits to Rs 678 crore in 2011-12 as against Rs 330 crore in 2010-11. Its total income recorded a 34 per cent jump to Rs 2,692 crore as against Rs 2,008 crore in 2010-11 and total expenses rose by 9 per cent to Rs 1,648 crore in 2011-12 as compared to Rs 1,516 crore a year ago.

Asked about rating outlook cut by Standard & Poors,Goel said,The rating outlook of the government owned institutions cannot be higher than the sovereign rating. So accordingly,our rating outlook has been revised.