The Rs 4,200 crore (Rs 42 billion) Murugappa group is toying with the idea of including a foreign strategic partner in its mutual fund arm Cholamandalam AMC, which plans to double its business to Rs 2,500 crore (Rs 25 billion) within a year.

The group is also serious on growing the mutual fund arm's business and it can go for acquisitions as and when opportunity comes, a senior company official told PTI in New Delhi.

The Chennai-based group is also planning to enter into the pension sector either through the mutual fund or insurance arm -- Cholamandalam General Insurance.

The broad plan of Murugappa's financial services group is to adopt a "cohesive" sales and marketing approach and cross-sell each other's products so as to create a financial super market.

Confirming the move, Cholamandalam AMC chief marketing officer Vineet Potnis said: "There is a plan to include a strategic foreign partner after the business grows to a critical size."

The AMC had ties with the United Kingdom-based Cazenove earlier but it fell through in 2001.

Potnis said the AMC has targeted to increase its assets under management to Rs 2,500 crore by December 2004 from the present level of Rs 1,109 crore (Rs 11.09 billion).

To attain the target, Potnis said the company is aggressively increasing its marketing and distribution network while leveraging the nationwide presence of the group's NBFC Cholamandalam Investment and Finance Company.

The AMC, which has ties with ICICI Bank, HDFC Bank, UTI Bank and IndusInd Bank, is talking to foreign banks for similar ties.