The Mumbai University could soon be the first educational institution in the country to invest in shares of blue chip companies. The 150-year-old institution is planning to raise money this way to facilitate infrastructure development and academic activities.

A state-funded university, it may pump in money into the stock market through its corpus fund of over Rs 100 crore.

While this may be a first in India, several universities in the US such as Harvard, Yale, Stanford, University of Texas System, and Massachusetts Institute of Technology have an endowment fund of cash, securities, and other assets that provide income for the support of a not-for-profit organisation.

"Rather than keeping money in fixed deposits and earning a low rate of interest, investing in stocks will be an intelligent way of utilising funds. We are very positive about its execution," says B Venkatesh Kumar, advisor to the vice-chancellor and associate professor, Rajiv Gandhi Centre for Contemporary Studies, Mumbai University.

The two benchmark indices� the NSE-50 and BSE Sensex � have been giving a compounded annual return of 29 per cent and 33 per cent, respectively, over the last three financial years. In fact, the market capitalisation of listed securities exceeds the aggregate deposits with the banking system.

The Mumbai University has earmarked Rs 2 lakh for a feasibility study on all aspects of fund-raising. It is also toying with the idea of getting listed on the Bombay Stock Exchange. This promises to help it attract better faculty members and students and also facilitate collaborations with international institutions of repute.

It will soon appoint a committee to examine the proposal. Said Vijay Khole, vice-chancellor, Mumbai University, "We are in the process of appointing a committee which will study all such measures. We want to find out if a state-funded university can get into such fund-raising activities."

In the US, Harvard University has a $28 billion endowment fund, bigger than any other school in the country.