Bajaj Finserv all set to launch $1-billion alts investment platform

Mumbai: Bajaj Finserv's alternative investment arm plans to raise up to the equivalent of $1 billion, expanding its presence beyond lending, mutual funds and insurance into non-traditional asset classes, a top group executive told ET. The platform, housed under Bajaj Alternate Investment Management, will span four verticals-private equity/venture capital, liquid alternatives, listed equity and real estate. The firm plans to raise ₹1,500-2,000 crore in each strategy over the next 18-24 months, with capital deployment expected to begin in the first quarter of the next financial year, Lakshmi Iyer, group president-investments and director, Bajaj Alternate Investment Mana-gement, said in an interview.

Over time, the platform could scale to the equivalent of $1 billion, depending on market conditions, she said. "This is not a monoline business. These are going to be like the supermarket of all businesses," Iyer said. "Wherever the Bajaj group has been successful, we believe the logical manifestation should be to the world outside."

While this is the group's first structured foray into alternatives, it has already deployed proprietary capital into scale-up ventures over the past three years, backing companies such as Ecosoul and KisanKonnect. "We have done about five or six investments in the private equity space. The ecosystem has been energised," Iyer said.

The firm has hired a 40-member team to build and execute the platform. With Securities and Exchange Board of India (Sebi) licences in place and applications across categories at various stages, Bajaj plans to approach investors only after completing internal preparation. "The time between launch and first close is crucial. We want to be fully prepared."

In liquid alternatives, the idea is to deliver better risk-adjusted returns than fixed income, while in listed equity strategies the firm will benchmark itself against indices such as the BSE 200 and NSE 500, targeting at least 3 percentage points of consistent outperformance. "If an investor only wants index returns, they can buy an ETF. Active funds must deliver clear alpha," Iyer said.

Fund managers will have meaningful skin in the game, she said.

Sponsor commitment is expected to exceed 20%, much higher than regulatory minimums.