HDFC AMC has launched its First Alternative Investment Fund (AIF)

Feb 16, 2023

HDFC Mutual Fund one of India’s biggest mutual fund houses, has introduced it’s first alternative investment fund (AIF) - HDFC Select AIF FOF – I, this product marks it’s foray into the alternative assets space.

It is a Category II AIF (Fund of Funds) that will invest in venture capital (VC) and private equity (PE) AIFs, broadly split equally between the two, with no pre-defined sector.

This Fund of Fund scheme that endeavours to invest in AIFs is currently open for subscription. HDFC AMC is planning to raise Rs 1500 crore with an option to collect up to Rs 1500 crore more through the Greenshoe option. The fund house is expecting the scheme to have its first closure before the end of March 2023.

The minimum contribution amount in an AIF is Rs 1 crore, according to SEBI regulations. The AMC will take this commitment amount over a five-year period in order to make the scheme more accessible to investors.

As a FOF scheme it enables investors to invest in multiple AIFs without having to commit a considerable amount of money to each of these funds individually. The FOF, according to the AMC, is for investors looking for diverse exposure in the unlisted space, with a portfolio that comprises investments in zero-day to pre-IPO stage ventures.