Gujarat Venture Finance (GVFL) today said it will launch a Rs 1,000-crore infrastructure development fund.
Golden Gujarat Growth Fund Series-I will be launched in January, the Gujarat government's venture capital arm said.
"This Sebi-registered fund will focus on making investments in high-end SMEs and mid-corporate firms in the infrastructure domain, alternate energy sector, and clean and green technology," GVFL Executive Director H C Pattnaik told PTI.
Launch of this all-India fund has been synchronised with the Vibrant Gujarat Investor Summit-2011, a biennial event of the state government, which will be held in January.
"The Gujarat government's contribution will be 20 per cent in this fund; 10 per cent each shall come from an anchor bank and anchor industry, respectively, while the remaining 60 per cent will be raised from the domestic and foreign institutions," Pattnaik said.
"We have approached financial institutional investors like SIDBI, Asian Development Bank, LIC, General Insurance Company, besides IFC Washington and a few private equity funds to raise 60 per cent of the corpus," he said.
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GVFL has got all the in-principle approvals for the fund, and is now awaiting final nod from the state government, Pattnaik said.
"The first fund closure will be by March 2011, and final closure will be by March 2012," Pattnaik said, adding that projected internal rate of return (IRR) to the investors from this seven-year fund is 20 per cent.
Started by Gujarat Industrial and Investment Corp (GIIC) at the initiative of World Bank in 1990, GVFL has invested in close to 73 companies till now. Of these, it has exited from 58 firms offering IRR up to 13 per cent to its investors.
Among the first venture capital firms in India set up on the initiative of World Bank to fund technology-driven first generation start-up companies, GVFL had launched SME technology fund in 2008 with a corpus of Rs 100 crore.
"Of this Rs 100-crore corpus, we have invested Rs 57 crore in six technology-driven companies in the SME segment so far, and investment of Rs 10 crore each shall be made in another 4-5 firms in the segment by March-end," Pattnaik said.
The Gujarat government has 56 per cent stakeholding in GVFL through its institutions like GIIC, GACL, GSFC, GNFC and others, while HDFC has 13.6 per cent stake in its. ICICI Group and other entities have around 20 per cent stakeholding in the venture firm.