The Tata Group is raising a $ 1 billion (Rs 4,700 crore) fund to invest in infrastructure in the country. The fund, for which the group has been in talks with a clutch of investors, will be managed by Tata Realty and Infrastructure Limited (TRIL).
TRIL would invest in various infrastructure projects in the country, some of which have already been identified, the company said today. TRIL, which was formed in March 2007, has already raised a $ 700 million (Rs 3200 crore) realty fund, of which 20 per cent has been already fixed for deployment, said Sanjay Ubale, managing director, TRIL.
The new fund would be raised from foreign investors and pension funds, among other sources, and would be deployed in foreign direct investment (FDI)-compliant projects.
The company is expecting an average Internal Rate of Return (IRR) of between 22 and 25 per cent for the projects it would undertake, though they would target higher return rates for its investors, said Kishore Saletore, chief financial officer, TRIL.
TRIL is investing in a 25 acre IT/ITES special economic zone project near Chennai, where they would build a large office space, a five star hotel and a convention centre for an investment of close to Rs 3800 crore.
The project is being constructed in collaboration with Tamil Nadu Infrastructure Development Corporation (TIDCO) and Indian Hotels Corporation, the hospitality arm of the Tata Group.
The company is also undertaking the four-laning of 110 km of the Mumbai-Hyderabad highway from 40 km outside at Pune. The project is being executed at a cost of Rs 1400 crore, of which Rs 970 crore would be financed through debt, said a TRIL official.