The portfolio management services (PMS) arm of IDFC Investment Advisors has launched a Rs 500 crore portfolio fund - IDFC Hybrid Infrastructure Portfolio (HIP). The fund aims to invest in the equities of companies involved in infrastructure activities for a span of 4-5 years, reckoning returns in the range of 35 per cent.
"Mid-size infrastructure companies tend to do well in a bear market and we will tap that segment. IDFC will invest 10 per cent in the fund, while the minimum investment will be Rs 10 lakh per investor. The corpus of HIP will be invested across 8-14 companies with no sector more than 40 per cent and no single company getting more than 20 per cent," said Naval Bir Kumar, managing director of IDFC Mutual Fund.
Interestingly, the money collected under HIP targets investments in private equity deals and in private investments in the public enterprises (PIPE) space. The company said that it would invest in those companies which have completed mezzanine financing. About 75 per cent of the investments would go into the unlisted space, though the company would keep itself away from projects with long gestation periods, unlike the conventional private equity deals.
The company has mopped up about Rs 250 crore under HIP in the last one month, and expects to raise another Rs 250 crore from a group of high net worth individuals (HNIs) over the next few months. "This fund is particularly designed for HNIs, and we will prefer not to invest in real estate. Telecom, energy, transportation, IT & Media, Travel and Tourism, and infrastructure-focused financial services companies will form a majority of HIP's investments. No investment will be made in the securities of IDFC or its group companies," added Kumar.
The company said that for investors parking less than Rs 25 lakh, 50 per cent of the committed capital will be drawn down initially. For those committing Rs 25 lakhs or more, the initial investment would be 20 per cent, while the balance would be drawn within a period of two years.