Tata Capital, the financial services arm of Tata Group, on Tuesday announced that it is planning to launch its private equity business by the end of first quarter of the next financial year (2009-10).

While speaking on this, Tata Capital managing director and CEO Praveen P Kadle said, “We will be launching our private equity business by the end of first quarter of the next financial year.”

It is learnt that the private equity business would be funded by Tata Capital’s own and third-party investments, and for this purpose the company is in talks with both the domestic and international players.

Commenting over this point, J Niranjan, Tata Capital, head, investment banking, said, “The first round of funding by the PE firm will be around $350-$500 million....the fund will invest across all sectors.”

The company had earlier made it clear that Shailendra Bhandari would be heading its private equity business.

It may be recalled that Bhandari, former managing director and CEO of Centurion Bank of Punjab, has held leadership positions in Citibank, HDFC Bank and ICICI Prudential Asset Management Company, where he was the CEO.

The issue has an option to retain over-subscription of up to Rs 1,000 crore.

Moreover, the company (Tata Capital), which is raising Rs 500 crore through a debenture issue, is expected to start its home loan business by March 2009.

Mr. Kadle added, “We have applied to the National Housing Bank (NHB) and are awaiting its clearance. If we get the approval we will launch the home loan business by March.”

He also said that the company had applied to the NHB a couple of months back.