LIC Housing plans Realty MF, to access funds via 'public deposits'
Mumbai, June 7 (UNI) LIC Housing Finance Ltd is contemplating on setting up a 'real estate mutual fund' as part of its diversification initiatives.
Briefing newspersons here, its Director&Chief Executive S K Mitter said, ''With a booming real estate market, there is great scope for real estate mutual fund (REMF) to succeed in India. REMF have been a great success abroad and as such, we would like to develop one ourselves in the near future.'' That apart, Mr Mittter said the company has plans of mobilising funds through public deposits. Its borrowals this fiscal is of the order of Rs 6,700 crore as against Rs 5,200 crore last year. As such, he continued, the company plans to go in for 'public deposits' as it would help reducing the cost of funds as well as it would be a new source of accessing cost effective funds.
Commenting on the diversification activities pursued by the company, Mr Mitter said the company has floated a subsidiary LICHFL Care Homes Ltd to conduct the business of running Assisted living community centres' for senior citizens. In its first phase, the Bangalore project houses 98 independent cottages spread across 10 acres of verdant garden.
With the overwhelming response to its pilot project at Bangalore, Mr Mitter said these centres hold tremendous future. It was also planning to set up residential units in Kochi, Bhubaneshwar, Kolkata, Haridwar and Delhi in the coming months.
It plans to set up real estate mutual funds notwithstanding, the company has currently participated in the Kotak Realty Fund with a contribution commitment of Rs 50 crore and CIG Realty Fund, contribution commitment of Rs 10 crore, he said.
Replying to a question, Mr Mitter said these initiatives will give a cushioning effect to the company, which is indeed facing pressure on the margin front. However, he added, ''The strain on the margin has not adversely affected it.'' UNI SN KU AG2028