IDFC Private Equity, a wholly owned subsidiary of Infrastructure and Development Finance Corporation (IDFC), plans to launch its third private equity fund by December 2007. It hopes to raise Rs 7,000-8,000 crore by the end of this financial year for this fund.
The infrastructure company had raised Rs 7,000 crore for its first and second funds.
“If the growth continues to be as strong as it is now, we will have to raise more capital,” said Rajiv Lall, managing director and CEO of IDFC, said in a conference call with analysts after announcing the financial institution’s second-quarter results.
IDFC’s second quarter profit, including that of its units, rose 26%, to Rs 194 crore from Rs 154 crore a year earlier. Revenue rose 63% to Rs 657 crore.
Net interest income (NII) has increased by 55% from Rs 213 crore during the first half of 2007 to Rs 329 crore 2008.
“NIIs can come under pressure if interest rates go up. However, we feel interest rates have peaked now,” Lall added.
IDFC has already got handsome returns for its first fund that closed in 2004. Its second fund, in association with Citibank and US major Blackstone, is slated to close in December.
IDFC has benefited from a 40% increase in the government’s infrastructure spending to Rs 1, 34,000 crore this year. India, which aims to increase the annual growth rate to 10% by 2012, will need $475 billion over the next five years to improve roads, ports and electricity generation plants.
Source: DNA India