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September 07, 2008

Profile of Jai Corporation's Anand Jain

Business Today has a profile of Anand Jain, promoter of the infrastructure-focused Jai Corporation and the real estate-focused Urban Infrastructure Fund.
That Jain is (Mukesh) Ambani’s lieutenant is quite clear, but that doesn’t mean he doesn’t have his own vision for his own company, Jai Corp. He is looking at developing real estate on the outskirts of the SEZs, along with independent townships, as the area within the SEZs will not be enough to cater to housing needs. “Every person would need an average of 50 square feet of office space and three times that for residential needs,” he explains. Jai Corp. is planning to develop two townships along the Mumbai-Pune Expressway, of 300 acres each. It is also planning a township in Talegaon and one in Nasik.

Of course, it’s quite likely that Ambani will also be an investor in many of such projects, including a port at Rewas (on the western coast), and a 2,000-MW power plant near the SEZs. The power unit will run on gas supplied by RIL. Some will see these developments as a backdoor entry by Mukesh Ambani into a business where his younger brother Anil is present—which may renege on the settlement agreed on by the two brothers that they will not intrude into each other’s businesses.

“The agreement is between the brothers and not with Jai Corp.,” quips Jain. Other than infrastructure, Jai Corp. has entered into financial services by setting up a real estate fund. The ‘Urban Infrastructure Fund’, which has Nikhil Meswani, Executive Director, RIL, as one of its advisory committee members, has a corpus of Rs 3,300 crore; it also advises a $550-million (around Rs 2,250 crore) offshore fund. From this business, Jai Corp. will earn a 2 per cent annual fee for the domestic fund and 1 per cent from the offshore fund every year till their maturity. In addition, the company will charge a 20 per cent fee at the time of maturity from the domestic fund. The Jai Corp. stock, for its part, has been shattering all records, rising almost 2,800 times in the last two years, ostensibly on the back of the upside that lies in the company’s new focus on infrastructure.

Arun Natarajan is the Founder & CEO of Venture Intelligence, the leading provider of information and networking services to the private equity and venture capital ecosystem in India. View free samples of Venture Intelligence newsletters and reports.