Kotak Investment Advisors announces launch of Fund of Funds

Kotak Investment Advisors Limited (KIAL) has announced the launch of Kotak India Alternate Allocation Fund, a Fund of Funds (FoF) to invest in other Private Equity (PE), Venture Capital (VC) funds coupled with direct investments into companies.

The fund targets to raise Rs 1,500 crore, including a greenshoe option of Rs 750 crore. The fund's objective is to diversify across PE/VC funds in multiple sectors, including consumer, technology, healthcare, financials, etc, as well as across multiple stages, from early stage to growth stage and late stage across different vintages. 'Vintage' refers to the first year the fund starts investing in companies. The fund also intends to invest some portion into co-investment opportunities available from such investee funds.

Nidhi Chawla, Fund Manager, Kotak India Alternate Allocation Fund said, "Investors require an optimal alternate equity portfolio through diversification, right fund manager access and professional selection. Lack of knowledge and information availability in this asset class makes it difficult to take an informed choice. Diversification of risk across managers is tough due to high minimum investment requirements. Through Kotak's Fund of Funds we intend to provide investors access multiple funds as well as leverage our institutional diligence with peer benchmarking data available, coupled with institutional monitoring of long tenure funds."

"The performance difference between best and worst fund managers in PE/VC funds can be as high as 15-20% IRR, so manager selection is critical," adds Chawla.

Srini Sriniwasan, Managing Director, Kotak Investment Advisors Limited said, "Indian alternate ecosystem has become vibrant with PE/VC fund managers delivering consistent returns and outperformance over public benchmarks. But many of the marquee fund managers have been inaccessible to domestic investors as they raised only offshore capital or had high minimum ticket investment requirements. With Kotak's Fund of Funds, we intend to enable access to such funds and increase domestic overall participation in the Indian alternates industry".

Kotak India Alternate Allocation Fund is set up as an Alternative Investment Fund under SEBI regulations, managed by Kotak Investment Advisors Limited, the alternate asset management arm of the Kotak Mahindra Group.

Shares of Kotak Mahindra Bank Limited was last trading in BSE at Rs. 1851.40 as compared to the previous close of Rs. 1884.35. The total number of shares traded during the day was 32304 in over 2655 trades.

The stock hit an intraday high of Rs. 1880.00 and intraday low of 1840.50. The net turnover during the day was Rs. 59796102.00.

Source : Equity Bulls

Keywords

KotakMahindraBank INE237A01028 KotakInvestmentAdvisors FundofFunds KotakIndiaAlternateAllocationFund