India’s Alternative Investment Fund Industry Doubles to $72bn in 5 years
SINGAPORE, May 25, 2022 /PRNewswire/ — India’s alternative investment fund (AIF) industry has doubled from $36bn at the end of 2016 to $72bn by September 2021 – an increase of more than 100% in assets under management (AUM) for Securities and Exchange Board of India (SEBI) registered funds alone according to the most recent Benchmark Report for India Alternative Investment Funds (AIFs). The report was published today by Preqin, the global leader in alternative assets data, tools, and insights, in partnership with the Indian Venture and Alternate Capital Association (IVCA), and under eligibility from SEBI.
The benchmarks in the report comprise of 296 schemes across AIF Category I, II, and III, for performance data as of 31 March 2021. These benchmarks provide a top-level overview on a range of indicators such as net internal rate of return (IRR), net multiple, called capital, distributions to paid-in-capital (DPI), and residual value to paid-in-capital (RVPI) on the dominant strategies that are employed by domestic managers.
India’s AIF industry is experiencing rapid growth and attracting investor interest
The benchmark includes AIFs registered with SEBI. Category I, II, and closed-end PIPE funds are eligible for benchmarking if the scheme has completed one year from its first close, up until March 2021. Angel funds and schemes without transactions are excluded. Category III and open-ended PIPE funds are eligible for benchmarking if they were incepted prior to March 2021.
Preqin’s Benchmark Report found that Category I funds outperformed the MSCI India Total Return Index by 19%, backed by strong venture capital returns, with Category I funds of vintage 2016 being the best performing at 24.6% net IRR. Additionally, India-focused venture capital funds offer the highest median net IRR compared to the other asset classes at 18% but have the highest standard deviation of net IRR at 34%.
Geetanjali Bhalotia, SVP, APAC Head of Research at Preqin says: "We started this journey late last year and I am very pleased to see the results. My team and I would like to thank all the GPs who supported us in this journey by providing us with their valuable data. With this, we are now able to provide transparency to various investors and managers, who are keen to tap on opportunities arising from India’s fast-growing alternative assets industry. The launch of this benchmark will help investors compare and measure fund performance of AIFs in India, and it further solidifies Preqin’s commitment to the Asia-Pacific region."
GPs who are interested in obtaining a custom performance benchmark to measure your scheme against other AIFs in India can contact Preqin by filling in your details here. To find out how you can submit your performance data for benchmarking, please reach out to us at this email address: aif@preqin.com.
About Preqin
Preqin is the Home of AlternativesTM, the foremost provider of data, analysis, and insights to the alternatives industry. The company has pioneered rigorous methods of collecting private data for almost 20 years, enabling more than 170,000+ global professionals to streamline how they raise capital, source deals and investments, understand performance, and stay informed. Through close partnerships with its clients, Preqin continuously builds innovative tools and mines new intelligence, helping them to make better decisions every day. For more information visit www.preqin.com.
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