Private credit play: Modulus Alternatives’ third fund crosses Rs 300 crore in first close

Modulus Alternatives Investment Managers Limited has announced the first close of its third private credit fund, India Credit Opportunities Fund III (ICOF III), with gross commitments exceeding Rs 300 crore.

The first close saw participation from a diverse group of investors, including ultra-high net worth individuals (UHNIs), high net worth individuals (HNIs), institutional investors, sponsors and their affiliates, highlighting investor confidence in Modulus Alternatives’ private credit strategy and track record.

ICOF III is a SEBI-registered Category II Alternative Investment Fund (AIF) with a target corpus of Rs 2,000 crore, including a Rs 1,000 crore greenshoe option. The fund will focus on performing credit opportunities across businesses with established business models, sector tailwinds and meaningful entry barriers.


A Category II Alternative Investment Fund (Category II AIF) is a SEBI-regulated pooled investment vehicle that invests in assets such as private equity, private credit, real estate and other alternative investments.

The fund will follow Modulus Alternatives’ established investment approach, with a focus on disciplined underwriting, capital preservation and downside protection.

Its strategy will emphasise senior-secured structures and robust covenant protection while seeking to build a diversified portfolio across high-growth sectors.

“The first close of ICOF III marks an important milestone for Modulus and reinforces our conviction in the opportunity within India’s evolving private credit landscape,” said Sandeep Agarwal, CEO & CIO, Modulus Alternatives said in a release.

“We believe the next phase of growth will create increasing demand for flexible, structured capital that can address the needs of high-quality mid-market businesses beyond traditional financing avenues. Our strategy is anchored in disciplined underwriting, strong downside protection and a deep understanding of the businesses we back. As we scale the platform, our focus will remain on generating risk-adjusted outcomes for our investors,” he added.

The launch of ICOF III builds on Modulus Alternatives’ track record in the performing private credit segment. Across its credit platform, the firm has facilitated investments of more than Rs 3,250 crore across 32 investments and completed 21 exits, including 20 exits ahead of maturity.

The platform has returned more than Rs 1,900 crore to investors to date and reported zero credit losses across its investments. Meanwhile, India Credit Opportunities Fund II is currently targeting a gross IRR of 16%+, alongside quarterly income distributions, according to the company.

Modulus said ICOF III will leverage its experience in credit origination, structuring and portfolio management to build a diversified portfolio across high-growth sectors. The investment approach will remain focused on capital preservation, disciplined risk assessment and institutional-grade governance, with the objective of delivering risk-adjusted outcomes for investors.

Established in 2018, Modulus Alternatives Investment Managers is an independent alternative asset management platform focused on performing private-credit strategies and addressing the credit gap in India’s mid-market segment.

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