Motilal Oswal Alternates forays into maiden Private Credit Fund

Motilal Oswal Alternates on Thursday announced its foray into the private credit, having initiated regulatory processes to launch its private credit arm. The maiden fund proposes to raise Rs 3,000 crore, including the green shoe option of Rs 1,500 crore.

The move marks the group’s foray into India’s rapidly expanding private credit segment at a time when the country’s credit ecosystem is undergoing structural change.

The fund will focus on secured lending and customized financing solutions for mid- to large-sized corporations, targeting risk-adjusted returns from debt yields and equity-linked upside, the company said in a statement.

Commenting on the launch, Vishal Tulsyan, Executive Chairman, Motilal Oswal Alternates, said, “Motilal Oswal Alternates has built a distinctive franchise in private equity and real estate over the last two decades, and now expanding into private credit is a natural evolution of our business strategy. The private credit business will have synergies with our existing businesses and will draw upon the existing strength and vast knowledge base of Motilal Oswal Group. Overall, we are very excited to get into this already vibrant and burgeoning asset class.”

Rakshat Kapoor, Head – Private Credit, Motilal Oswal Alternates, said, “India’s private credit market is relatively mature and growing rapidly. Mid-market corporates with strong operating track records are seeking flexible, non- dilutive growth capital suiting their financial needs. The proposed fund looks to invest in growth capital and special situation-oriented transactions.” 

“Leveraging on the Motilal Oswal Group’s deep equity investing framework, we envisage more transactions of hybrid nature, where we can look to have participation in equity upsides. We look to generate risk adjusted returns as regular private credit yield and/or also linked to equity upsides. The Motilal Oswal ecosystem is well positioned to leverage its wide network to seek these varied private credit opportunities and to draw upon the rich investing experience in managing other asset classes.”

Motilal Oswal Alternates has raised over Rs 23,000 crore across 11 private equity and real estate strategies and is expected to exceed $3.5 billion in assets under management over the next year with the addition of the proposed private credit fund.