RV Capital Management Pvt.’s India unit plans to raise 8 billion rupees ($131.5 million) through its first India private credit fund, joining a growing list of global managers that are setting up similar ventures in the nation.
The fund will primarily invest in mid-market corporates, while putting up to 20% of capital in listed local-currency bonds, Shyamal Karmakar, managing director and chief investment officer at RV Capital Advisory India Pvt., a unit of Singapore-based firm, said in an interview in Mumbai. The five-year private credit fund is “targeting a rupee return of 14% - 16%,” he added.
RV Capital is entering India at a time when Asia’s third-largest economy is set to become a hotspot in the region for private credit, in part because of rules that forbid bank loans being used for mergers and acquisitions. India-focused assets under management in private debt nearly doubled to US$15.5 billion ($21.2 billion) as of December 2022 from a year earlier, according to financial data provider Preqin.
RV’s India fund is sector agnostic, Karmakar said, but will stay away from funding real estate construction, venture debt and also those companies where lenders have taken a haircut but the management hasn’t changed.
“We are open for holding company, promoter, acquisition types of asset-backed financing,” he said.
The focus will be on the deal structure and collateral to reduce credit risk and ensure recovery in a scenario where the underlying credit isn’t doing well, he added.
