Develoment of a prospectus for a real estate mutual fund and development of corporate communications; Housing Development Finance Corporation Limited

Abstract

A Real Estate Mutual Fund is essentially a collective investment instrument set up with the express purpose of investing primarily in real estate and real estate related assets, The investor benefits from diversification of risk in a market substantially different from and unaffected by the capital and money markets. At the same time, the investor is able to invest lesser sums of money than would be required in a direct investment in real estate, and is assured of better liquidity since the instrument would be quoted in the capital markets. Real Estate Mutual Funds have been in existence in the USA since 1964 and form a major avenue of investment. HDFC, as India’s premier housing finance company, seeks to bring the concept of a REMF to India and has plans of floating a REMF in the near future. The project was to examine the various issues involved in floating a REMF in India, study and analyse the practices being followed in the USA and the UK, and recommend the practices that would be followed in an Indian REMF. ‘The effort culminated in the development of a draft prospectus for the REMF, which would be in line with the SEBI guidelines for REMFs in India. The prospectus document, following a brief discussion of the various issues involved in designing the REMF, formed the first part of the project. HDFC offers Housing Finance companies and governments in developing countries the benefit of its experience in setting up and managing a vibrant housing sector in India. Its personnel are much sought after as consultants. There existed a need for better communications of their past experience in the field of Consultancy services abroad, and the areas in which they offered their Consultancy Services. The second part of the project involved developing corporate communications for the Consultancy Services which would form a part of their bid document and one - page articles detailing each aspect of HDFC’s area s of operations.