Neo Asset Management closes Rs 2,575Cr maiden special credit opportunities fund

Neo Asset Management has recently closed its first special credit opportunities fund, raising Rs 2,575 crore from high-net-worth individuals (HNIs) and multi-family offices.

This Category II Alternative Investment Fund (AIF), named Neo Special Credit Opportunities Fund, aims to provide customized credit solutions to profitable companies that struggle to secure financing through traditional channels.

The fund targets a gross internal rate of return (IRR) of 22-24% for its investors.

Who invested in the fund?

The fund received investments primarily from HNIs and multi-family offices. This strong backing underscores the confidence in Neo Asset Management's approach to private credit and real asset investments.

Hemant Daga, CEO of Neo Asset Management Pvt Ltd, expressed his gratitude, stating, "We are overwhelmed by the client response in making our Special Credit Opportunities Fund I, the largest maiden credit fund raised in the country. We are also seeing tremendous response from clients in our infrastructure income strategy and our core credit strategies, which reflects a massive demand for yield and regular income from clients."

What are the fund’s achievements so far?

In its first 15 months, the Neo Special Credit Opportunities Fund has made 12 investments and achieved two successful exits. The investments are fully collateralized, providing an additional layer of security beyond the operating cash flows of the companies involved.

Nitin Jain, Founder and Chairman of Neo Wealth and Asset Management, commented on the importance of private credit in India’s growing economy, stating, "As India progresses towards becoming the world's 3rd largest economy, private credit will play a pivotal role in meeting the industry's patient and flexible capital requirements."

Positioning itself as a leading alternative asset manager

Neo Asset Management is positioning itself as a leading alternative asset manager in India, focusing on private credit and real assets. The company recently raised USD 35 million from Peak XV Partners (formerly Sequoia India) as growth capital. Neo advises over 1,500 clients with assets under advice (AUA) amounting to INR 30,000 crore and assets under management (AUM) exceeding INR 6,000 crore.

The Indian private credit market, growing at an annual rate of 15-18%, offers a robust risk-adjusted asset class that provides regular income with significant downside protection. Hemant Daga highlighted the company's expertise, saying, "At Neo Asset Management, we strive to leverage our multi-decadal institutional expertise to provide innovative alternative solutions to our clients."