BENGALURU: Asia-focused firm BPEA Credit plans to launch its largest fund with a corpus of around $750 million, which is likely to focus on high-growth sectors such as services, infrastructure and manufacturing. An executive told Mint. This comes amid a major overhaul that saw the company rebrand as Ascertis Credit.
The private credit platform of the former Barings Private Equity Group has raised four funds and invested more than $1 billion over the past 10 years. Previous fund sizes were $161 million, $221 million, $475 million and $600 million. The firm claims to have made more than 40 exits across its funds and has recorded returns in the high teens.
Given the fund’s focus on Asia, India continues to be the investment firm’s largest market, with a majority stake. “I think India is going to be the dominant market for the foreseeable future…We’re still going to see significant growth. It’s a very important part of our portfolio,” said BPEA Credit Group Head Kanchan Jain said in an interview with Mint.
Mainly in India and Southeast Asia
Apart from India, Southeast Asia is an important segment for the company. “These are not only the largest markets, but they also have very low penetration. There is no need to look at other markets because the opportunity is so huge,” she said.
Established in 2014 as BPEA Credit, the newly branded entity will continue to manage capital for major global pension funds and development finance institutions, as well as a diverse range of family offices across Asia and India. The investment firm has offices in Delhi, Mumbai and Singapore.
Ascertis Credit’s Income Fund Series
Earlier this year, Ascertis Credit also launched a new fund called Select Short Term Income Fund-I (SSTIF) with a corpus size of Rs 750 crore excluding greenshoe option focused on stable short-term income. Launched a new series of income funds. Term investment in India. “We saw a huge opportunity in the market in the credit space. This new series is a separate product but still falls under performance credit and provides growth capital to mid-sized companies,” said Jain. Ta.
Both types of funds, the Ascertis Private Credit Fund and the new Income Fund Series, generally require capital for growth, but may have different return and liquidity profiles. They may also differ in other aspects, such as fund holding periods, leverage, and slight differences in size and target companies. For example, a regular fund has a life of 5 years, whereas a new income fund has a life of 3 years.
The investment firm also operates with moderate leverage, with slightly different nuances between both funds. Jain explained that investors are seeing a need for products with shorter terms and more regular coupons, and portfolio companies are also looking for similar solutions.
niche area
Private credit companies typically have less exposure to irrigation projects, commercial and residential real estate, and other manufacturing and industrial sectors that are not typically considered in traditional private equity and venture capital ecosystems. have a larger canvas to invest in niche areas such as “However, the types of sectors we focus on change slightly every two to three years when raising new funds, depending on macroeconomic factors that can negatively impact a particular area. ” Jain said.
He added that private equity and venture capital are increasingly focused on specific sectors, leaving many holes to fill in high-growth sectors that don’t have the growth capital they need. “This makes for a great private credit strategy…with the added benefit that the real downside is much more protected than in venture capital or private equity,” Jain said.
