Key Takeaways
- • TVS Capital Funds has entered private credit with the launch of TVS Alts, targeting an initial corpus of Rs 750 crore with a Rs 500 crore green-shoe option.
- • The fund will provide secured lending to performing companies with ticket sizes of Rs 40 crore to Rs 100 crore and targeted returns of around 17 per cent.
- • TVS Alts has filed with SEBI and expects regulatory approvals in the coming weeks; the first close is targeted within six months of approval and the final close within 12-14 months.
- • Manish Makaria will serve as Managing Partner, and the investment team has evaluated 42 opportunities, with two or three under active consideration.
- • The fund is predominantly domestic-capital, with expected investors including insurance companies, bank treasuries and corporates, and follows the closing of TVS Capital Funds' fourth private equity fund at nearly Rs 4,000 crore.
Summary
TVS Capital Funds (TCF), one of India's prominent investment firms, has entered the private credit market with the launch of TVS Alts, according to a company statement. The platform marks a strategic expansion beyond TCF's established private equity business and is a subsidiary in which TCF holds a 90 per cent stake, with the remaining 10 per cent held by Shyam Srinivasan, Co-founder and Executive Chairman of TVS Alternatives.
The proposed fund targets an initial corpus of Rs 750 crore, with a green-shoe option of Rs 500 crore. It will focus on secured lending to performing companies with sound credit profiles and adequate security, with individual tickets ranging from Rs 40 crore to Rs 100 crore and targeted returns in the range of 17 per cent. The strategy is sector-agnostic and will address bridge financing, pre-IPO financing and M&A-related funding. Srinivasan said the firm will maintain stringent underwriting standards and disciplined pricing, and that credit quality in India's mid-market segment is holding up well.
TVS Alts has received internal approvals and filed applications with the Securities and Exchange Board of India, and expects the requisite regulatory approvals in the coming weeks. The investment team has evaluated 42 potential opportunities, of which two or three are being considered against the fund's underwriting and pricing requirements. Active deal origination will begin after approval. The platform aims to complete its first close within six months of regulatory approval and its final close within 12-14 months. Srinivasan expects the initial fund to make approximately 14-15 investments and said the firm may raise additional private credit funds over the next three to five years.
Like TCF's private equity business, the private credit strategy will be built predominantly on domestic capital, with potential investors including insurance companies, bank treasuries and corporates seeking portfolio diversification. Manish Makaria, who previously worked with TVS Capital Funds and later with SBI Funds Management, will serve as Managing Partner. The board will include Prasad Gopalan, a former senior executive at the International Finance Corporation; banking veteran Ashutosh Khajuria; former SIDBI executive Mani Krishna Iyer; and industrialist Srialalitha Gopal. The core team brings experience across commercial banking, private equity, investment banking and recovery.
The launch also reflects TCF's broader ambition to explore wealth management, asset management and other adjacent financial services over the long term. The move follows the recent close of TCF's fourth private equity fund with a corpus of nearly Rs 4,000 crore.
The proposed fund targets an initial corpus of Rs 750 crore, with a green-shoe option of Rs 500 crore. It will focus on secured lending to performing companies with sound credit profiles and adequate security, with individual tickets ranging from Rs 40 crore to Rs 100 crore and targeted returns in the range of 17 per cent. The strategy is sector-agnostic and will address bridge financing, pre-IPO financing and M&A-related funding. Srinivasan said the firm will maintain stringent underwriting standards and disciplined pricing, and that credit quality in India's mid-market segment is holding up well.
TVS Alts has received internal approvals and filed applications with the Securities and Exchange Board of India, and expects the requisite regulatory approvals in the coming weeks. The investment team has evaluated 42 potential opportunities, of which two or three are being considered against the fund's underwriting and pricing requirements. Active deal origination will begin after approval. The platform aims to complete its first close within six months of regulatory approval and its final close within 12-14 months. Srinivasan expects the initial fund to make approximately 14-15 investments and said the firm may raise additional private credit funds over the next three to five years.
Like TCF's private equity business, the private credit strategy will be built predominantly on domestic capital, with potential investors including insurance companies, bank treasuries and corporates seeking portfolio diversification. Manish Makaria, who previously worked with TVS Capital Funds and later with SBI Funds Management, will serve as Managing Partner. The board will include Prasad Gopalan, a former senior executive at the International Finance Corporation; banking veteran Ashutosh Khajuria; former SIDBI executive Mani Krishna Iyer; and industrialist Srialalitha Gopal. The core team brings experience across commercial banking, private equity, investment banking and recovery.
The launch also reflects TCF's broader ambition to explore wealth management, asset management and other adjacent financial services over the long term. The move follows the recent close of TCF's fourth private equity fund with a corpus of nearly Rs 4,000 crore.
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