Summary:

According to SEBI, India's Alternative Investment Funds (AIFs) have grown significantly, with total commitments reaching Rs. 13,00,000 crore (US$ 149.25 billion) by December 2024, reflecting a 5% quarter-on-quarter increase. AIFs raised Rs. 5,27,000 crore (US$ 60.51 billion), while total investments exceeded Rs. 5,00,000 crore (US$ 57.41 billion). Category II AIFs surpassed Rs. 10,00,000 crore (US$ 114.81 billion), while private credit expanded to 15% of total commitments.

Real estate investments declined from Rs. 75,000 crore to Rs. 73,900 crore (US$ 8.48 billion), whereas IT and ITeS investments grew to Rs. 30,300 crore (US$ 3.48 billion). Financial services investments increased to Rs. 26,800 crore (US$ 3.08 billion). Angel funds under Category I AIFs secured commitments of Rs. 8,700 crore (US$ 998.85 million). SEBI aims to expand the investor base by classifying Accredited Investors (AIs) as Qualified Institutional Buyers (QIBs). With 65% of AIF investments in unlisted assets and a decline in mid-market corporate lending, AIFs— particularly private credit funds—are bridging the gap by providing higher risk-adjusted returns and stable income streams. Amid market volatility, HNIs and institutional investors are expected to increase their AIF allocations, further strengthening their role in India's financial ecosystem.

Source: IBEF (Link)

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