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June 03, 2015

Reliance ADAG to set up operations in GIFT City

In a major boost to the GIFT City, Anil Ambani’sReliance ADAG group company Reliance Capital has been allotted 500,000 sq. ft. in the SEZ Area of GIFT City. This is the largest allotment to a Private Sector company till date by GIFT Co. Ltd. for setting up its operations in the 1st Smart City of India.

The allotment was announced by GIFT Co. Ltd.’s MD and Group CEO, Mr. RamakantJha and the allotment letter was handed over to Reliance Capital’s Executive Director Mr. Sam Ghosh. The Company will be developing 300,000 sq. ft. for office spaces and 200,000 sq. ft. for residential use at the IFSC.

 

GIFT Co. Ltd. has allotted around 13 million sq. ft. BUA to various companies for development of commercial, residential and social areas. These allotments are expected to bring in investment of more than INR 9,000 crores to the GIFT City SEZ and non-SEZ areas.

Reliance Capital is planning to start multiple businesses including starting an Alternative Investment Funds (AIF) in GIFT City. The Company is in the process of applying for all the required regulatory approvals to set up its operations.

GIFT City was officially launched in April 2015 and the regulatory norms for the companies which are eyeing to set up their operations in GIFT City were announced in April 2015 by the Union Finance Minister Shri Arun Jaitley. The regulatory bodies of India like SEBI, RBI and IRDA has already announced the regulations for companies which intend to set up operations at GIFT City.

Mr. Jha on the occasion of allotting the space to Reliance Capital stated that the Board of GIFT Co. Ltd. has approved the request of Reliance Capital which had shown a keen interest to set up operations in GIFT City. The allotment is expected to employ nearly 2,500 people over the next 2-3 years and Reliance Capital is expected to make an investment of around INR 200 crores. This allotment is the biggest allotment which the Board has made to a private company till now.

Reliance Capital has raised a corpus of INR 2,000 crores over a period of 2 years under its AIF platform. The Company has a strong AIF business and the AIF has been rated by CRISIL. CRISIL has given a rating of Fund Management Capability Level-1 which is an indication that the AIF business has the best standards in fund management capabilities and investment process. Mr. Ghosh during the joint media briefing stated that such rating by the rating agency is an endorsement of the experienced real estate investment team at AIF and its processes and practices.

Mr. Ghosh stated that the Company is currently having international businesses at some of the global Financial Centres like Singapore, Tokyo and Dubai. It expects to start those international businesses at GIFT City. The Company has about $1.7 billion of off-shore fund which it operates from Singapore.

It is also expected that Reliance Capital may start wealth management and retail broking business in foreign currencies after it sets up the operations in GIFT City. At present, the wealth management portfolio of the Company has about 1,500 crores AUM.

Reliance Capital is planning to start an International Commodity Exchange at GIFT which could be the largest Exchange of the world. It will also use the facility to expand its existing business on an international arena. It will also use part of the allotted space to construct houses for its employees at GIFT City.

It is expected that this exchange will be launched in a year’s time if all the approvals are received on time. The planned International Exchange will trade in commodities like gold and silver and hence will attract international investors.

It will be worthwhile to note that in April 2015, GIFT had signed an MoU with National Commodity and Derivatives Exchange (NCDEX) to set up an International Commodity and Derivatives Exchange. The proposed NCDEX Exchange at GIFT will provide electronic platform to international investors and facilitate trading, clearing and settlement of commodities, securities, currencies and other asset classes and derivatives.

 

 

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