Key Takeaways
- • ICICI Prudential AMC is launching a Category II Alternative Investment Fund (AIF-II) targeting ultra-high net worth individuals, family offices, and institutions with a base target of ₹1,500 crore and a greenshoe option of ₹2,500 crore, enabling up to ₹4,000 crore in total capital raise.
- • The fund will deploy capital primarily in debt securities across old-economy, asset-heavy sectors including power, logistics, textiles, pharmaceuticals, roads, hospitality, and supply chain, with a disciplined diversification strategy capping sector exposure at 20% and targeting 12–15 transactions.
- • Investment strategy emphasizes three-to-four year hold periods with an average of three years; the scheme term is four years and six months from first close, with two one-year extension options available with investor approval.
- • ICICI Prudential AMC is leveraging the successful closure of its prior Corporate Credit Opportunities Fund AIF-1 (₹1,600 crore) to launch this new vehicle, with September 2023 targeted as the first close.
- • The fund will exclude distressed debt and special situations strategies, focusing instead on primary and secondary debt securities purchases in fundamentally sound, asset-heavy businesses.
Summary
ICICI Prudential Asset Management Company is launching a new closed-ended Alternative Investment Fund (AIF-II) under its ICICI Prudential Debt Fund - Category II AIF series, targeting a base raise of ₹1,500 crore with a greenshoe option of ₹2,500 crore for a potential total of ₹4,000 crore. The fund is being positioned exclusively for ultra-high net worth individuals, family offices, and institutional investors seeking exposure to middle-market debt opportunities with three-to-four year underlying transaction timelines.
According to Shekhar Daga, head of private capital at ICICI Prudential AMC, the fund will deploy capital in established, asset-heavy sectors including power, logistics, textiles, pharmaceuticals, roads, hospitality, and supply chain businesses. The investment approach targets debt securities in the primary and secondary markets, deliberately avoiding distressed assets and special situations strategies. Daga emphasized a disciplined portfolio construction methodology, maintaining a 20% sector cap and aiming for 12–15 transactions to achieve a weighted average allocation of 7–8% per position on a diversified basis.
The new fund launch follows the successful closure of ICICI Prudential Corporate Credit Opportunities Fund AIF-1, which raised ₹1,600 crore. The firm has targeted September 2023 as the first close for the new AIF-II series. The scheme has a base term of four years and six months from the date of first closing, with provisions for two one-year extensions subject to investor approval, providing flexibility for portfolio exits and value realization.
This initiative reflects ICICI Prudential AMC's strategic focus on the private credit and alternative investment space, catering to the growing demand from ultra-HNI and institutional segments for non-traditional asset classes offering differentiated risk-return profiles in India's mid-market debt landscape.
According to Shekhar Daga, head of private capital at ICICI Prudential AMC, the fund will deploy capital in established, asset-heavy sectors including power, logistics, textiles, pharmaceuticals, roads, hospitality, and supply chain businesses. The investment approach targets debt securities in the primary and secondary markets, deliberately avoiding distressed assets and special situations strategies. Daga emphasized a disciplined portfolio construction methodology, maintaining a 20% sector cap and aiming for 12–15 transactions to achieve a weighted average allocation of 7–8% per position on a diversified basis.
The new fund launch follows the successful closure of ICICI Prudential Corporate Credit Opportunities Fund AIF-1, which raised ₹1,600 crore. The firm has targeted September 2023 as the first close for the new AIF-II series. The scheme has a base term of four years and six months from the date of first closing, with provisions for two one-year extensions subject to investor approval, providing flexibility for portfolio exits and value realization.
This initiative reflects ICICI Prudential AMC's strategic focus on the private credit and alternative investment space, catering to the growing demand from ultra-HNI and institutional segments for non-traditional asset classes offering differentiated risk-return profiles in India's mid-market debt landscape.
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