ASK Private Wealth, the wealth advisory and family office arm of ASK Group, on Tuesday, said it has launched its first private credit fund worth $120 million (Rs. 1,000 crore), as the asset class continues to gain ground among companies seeking alternative ways to raise capital.
The fund expects to be sector-agnostic and will seek out opportunities within sectors including – healthcare, consumer, financial services, IT& ITES, manufacturing, specialty chemicals, and renewables.
It will invest across both operating companies as well as promoter/holding companies and will avoid distressed, real estate, utilities, state-owned or venture funding situations, the company said in a statement.
The ASK Private credit fund will have a tenure of five years from the first close and has hired Shantanu Sahai as senior managing partner and head of the fund, who previously was the managing director & head of debt at Nomura India.
ASK Group, a portfolio company of Blackstone, founded in 1983, caters to clients across Asia, the Middle East, Africa, and Europe. It manages the investment needs of India’s high-net-worth individuals, family offices, and institutions.
At a time when volatility in the equity markets, coupled with a high-interest rate environment, is making it difficult for companies in India to raise capital, more asset managers are launching their credit funds.
Earlier this year, 360 ONE Asset Management, formerly known as IIFL Wealth & Asset Management raised $258 million (Rs 2,130 crore) for its largest credit fund to date, exceeding its initial target of Rs 1,500 crore.
Previously, Centrum Alternatives, an asset manager headquartered in Mumbai, said it was looking to launch its second private credit fund. Among others who are raising credit funds, InCred Asset Management is targeting a Rs 500-crore ($61.2 million) corpus with a greenshoe option of another Rs 500 crore.
“The rise of private credit is fuelled by domestic M&A consolidation and the impaired primary equity markets, creating a demand-supply gap. Traditional providers of capital like non-banking financial companies (NBFCs) and credit mutual funds are pivoting away from wholesale structured lending, causing profitable mid-size businesses in need of structured bespoke funding solutions to look elsewhere. Industry estimates incremental demand for such credit solutions at Rs 30,000 crore annually,” Rajesh Saluja, CEO & Managing Director, ASK Private Wealth said.
“India is in the initial phase of a new credit cycle fuelled by private sector investment on the back of corporate deleveraging that has taken place over the past five years within India Inc,” Saluja added.