IDFC managing director Rajiv B. Lall in Calcutta on Tuesday. Picture by Kishor Roy Chowdhury

Calcutta, May 10: Infrastructure Development Finance Company (IDFC) will float a $150-million (Rs 660 crore) infrastructure fund in the US aimed at high net-worth individuals and institutional investors of that country.

The fund will be floated before the end of the current financial year. Talking to The Telegraph, Rajiv B. Lall, managing director & CEO of IDFC, said: ?The fund is aimed at qualified US investors who have a greater appetite for risk. India is one of the emerging markets where they would like to invest.?

The fund will invest in a combination of companies, including infrastructure firms that have outperformed the market in terms of market capitalisation. The companies mainly operate in the oil and gas, power, hotels and telecom sectors.

?Typically, their return on investment is around 30 per cent,? added Lall.

The remaining investment will go into companies that are not listed but have strong fundamentals.

The fund will be managed by IDFC Asset Management Company, a wholly-owned subsidiary of IDFC.

Encouraged by the success of its India Development Fund, IDFC is ready to launch its second private equity fund for domestic investors with a corpus of Rs 1,300 crore. The fund, which is likely to be launched in June-end or early July, will invest in infrastructure development projects.

Unlike the India Development Fund, foreign investors will make up two-thirds of the new fund’s corpus. Investment bankers are Kotak and DSP Merrill Lynch.

The company will conduct roadshows in London, Frankfurt, Milan, Edinburgh, New York, Boston, Chicago, Singapore and Hong Kong.

In June, IDFC will come out with its initial public offer. Lall refused to specify the size of the offer but said it would be ?substantial?.

The company will be filing its application with the Securities and Exchange Board of India within the next 10 days.

At present, the government holds 35 per cent in IDFC, while a host of domestic institutional investors (IDBI, UTI, IFCI, SBI, HDFC, ICICI Bank) hold 25 per cent and the remaining 40 per cent is with foreign institutional investors (FIIs).

?Following the float, the shares of financial institutions and FIIs will be diluted on a pro-rata basis. The government will remain the single-largest shareholder. Post-issue, FIs and FIIs will not continue on the board,? added Lall.