Norms for infra debt fund cleared; it may be trust or company

A trust-based IDF (Mutual Fund) would be regulated by SEBI while an IDF set up as a company (NBFC) would be regulated by the RBI, according to the finance ministry

New Delhi: In order to raise long-term resources for funding the infrastructure sector, the government today said the Infrastructure Debt Fund (IDF) could be set up either as a company or trust, reports PTI.

The IDF, which was proposed by finance minister Pranab Mukherjee in Budget 2011-12, is aimed at accelerating and enhancing flow of long-term debt for funding the ambitious programme of infrastructure development in the country. The requirement of infrastructure in the 12th Plan has been pegged at $one trillion.

“An IDF may be set up either as a trust or company...

A trust-based IDF (Mutual Fund) would be regulated by the Securities and Exchange Board of India (SEBI); an IDF set up as a company (NBFC) would be regulated by the Reserve Bank of India (RBI),” the finance ministry said in a statement.

Pointing out that the IDF is a novel attempt to address the issue of sourcing of long-term debt, it said the structure of the fund would be reviewed for efficacy and refinement.

The fund would try to garner resources from domestic and off-shore institutional investors, especially insurance and pension funds.

Banks and financial institutions would be allowed to sponsor IDFs.

Elaborating on the structure of IDF as a company, the release said it could be set up by NBFCs or banks, with a minimum capital of Rs150 crore. Such a fund would be allowed to raise resources through rupee or dollar denominated bonds of minimum five year maturity. These bonds could be traded among the domestic and foreign investors.

Company based IDFs would be allowed to fund projects in public-private partnership (PPP) which have completed one year of commercial operations.

Potential investors in this category, include offshore and domestic institutional investors, high networth individuals and non-resident Indians.

As regards the trust-based IDFs, the ministry said the fund could be sponsored by a regulated financial sector domestic entity. It would have to invest 90% of its assets in the debt securities of infrastructure companies or special purpose vehicles (SPVs) across all infrastructure sectors.

Minimum investment by trust-based IDF would be Rs1 crore with Rs10 lakh as minimum size of the unit.

The credit risks associated with underlying projects will be borne by the investors and not by IDF, but in case of company-based IDF, the fund would bear the risk.

The finance ministry said that IDF being a pass-through vehicle is easily workable if set up as a trust.

However, since a trust cannot issue bonds or undertake credit enhancement and cannot get withholding tax benefits, an IDF would also have to be allowed as a company.


Abhyudaya Bank eyes business mix of Rs11,300 crore in FY’12

The Bank plans to open 11 more branches in the year 2011-12

Abhyudaya Co-op Bank Ltd today said it is eyeing a total business mix of Rs11,300-crore in the financial year 2011-12.

"We are targeting a total business mix of Rs11,300-crore in FY’12 compared to Rs9,000 crore in FY’11," Abhyudaya Co-op Bank managing director & CEO Vijay Morye told reporters.

"We are looking at achieving deposits of Rs6,800-crore and advances of Rs4,500-crore in FY’12. The bank’s total deposits stood at Rs5,261-crore and advances at Rs3,453-crore in FY’11,” Morye said.

The bank plans to open 11 more branches in the year 2011-12, Morye said, adding that the bank plans to open new branched in New Delhi and Union Territories of Dadra and Nagar Haveli, and Daman and Diu in FY’13, to open new branches.

Over a span of 46 years, the bank has become a leading Urban Co-op bank in the country.

The Bank opened its 100th branch on the eve of its 47th foundation day today at Kandivali in Mumbai. Abhyudaya Bank has presence in Maharashtra, Gujarat and Karnataka.

"We are growing constantly with an aim to increase our market share in the coming years and fulfill our stakeholder’s expectations," Bank chairman Sitaram Ghandat said.

The bank has successfully implemented core banking solutions (CBS) allowing its consumers the facility to withdraw money without any extra charge.

It has also collaborated with 57 other banks across the country, providing pan India accessibility to its consumers from more than 75,000 ATMs through BANCS & NFS networks in India. It also offers other services like tele banking, mobile banking and internet banking services.


Kaya Skin Clinic to focus on expansion of service portfolio

At present, there are 104 Kaya Skin Clinics, spread across 26 cities across India and in the Middle East and other South Asian countries

Beauty services provider Kaya Skin Clinic on Friday said it will focus on expanding its service portfolio and brand building while consolidating retail presence to maintain its growth momentum.

The company, which incurred a loss of Rs2.30 crore in the last fiscal, said over the last one year it has focused on enhancing overseas presence and consolidating its retail operation in India.

“This fiscal, we are focused on introducing more range of products and rolling out awareness and brand building campaigns in the country,” Kaya Skin Clinic head (marketing) Suvodeep Das told PTI.

In the recent past, the company has launched more services like lip enhancement, fairness and hair removal services as part of its portfolio expansion. Besides, it has introduced in India seven beauty care products from Derma Rx range from the Singapore based Derma Rx Asia Pacific, which it acquired last year.

"We plan to bring in more products going ahead," Das said without giving further details on the products.

He said over the last one year the company had shifted its focus on international markets by entering into new countries like Bangladesh recently.

At present, there are 104 Kaya Skin Clinics, spread across 26 cities across India and in the Middle East and other South Asian countries. In the last 18 months, the firm has opened up to 10 clinics, primarily in the Middle East and Bangladesh.

"We have relocated some of our outlets and consolidated some of them in India. We will take a mix stand of bringing in more products and retail expansion," he said.

Suvodeep said the company is currently focusing on the top eight cities in India for its retail expansion and enhancing revenues from the existing outlets.


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