IL&FS reportedly invests in Gujarat

The Indian company has reportedly bought a 30 percent stake on JB Pharma’s special economic zone, a future hub for pharmaceutical manufacturing, for $15m. The deal was made through the $525m ILFS India Realty Fund I.

IL&FS Investment Managers, the publicly listed private equity arm of finance company Infrastructure Leasing & Financial Services, has invested $15 million for a 30 percent stake in pharmaceutical company JB Pharma’s special economic zone in Gujarat, according to The Economic Times.

The special economic zone will be a hub for the manufacture of pharmaceutical finished formulations, active pharmaceutical ingredients as well as their intermediates. It will also operate service activities related to research and development and contract manufacturing.

The 130 hectares special economic zone is expected to be completed at 2009 at the cost of approximately INR 1.6 billion ($32 million; €25.4 million), said the report.

The investment was made out of the India-focused real estate fund, ILFS India Realty Fund I. The fund, which closed on $525 million in June 2006, targets core assets as well as redevelopment and ground-up development projects. To date, it has made 17 investments and is now fully invested.

Some of India Realty Fund I’s investments include ETL Infrastructure Services, which provides infrastructure to sunrise industries in South India, as well as QVC Realty, a real estate development start up.

In December 2007, IL&FS held the first close of its second real estate fund on $578 million. The ILFS India Realty Fund II will target residential and commercial real estate, retail, redevelopment and hospitality sectors in the Tier-I and Tier-II cities.

The fund will invest mainly in projects for housing, offices, hotels, IT parks, and unlisted real estate companies. It has an eight to ten year lifespan and is aiming to achieve annualised returns of about 25 percent, according to the firm.