Private equity firm Amplus Capital Advisors Pvt. Ltd—which is part of the Lalbhai Group whose flagship company is Arvind Ltd—is planning to raise its third realty-focussed fund from mid-October, according to a media report.
The new fund, Amplus Realty Fund – III, will offer structured debt financing to residential projects in top cities. Its corpus is pegged at Rs 200-250 crore ($31-38 million), Mint reported.
“There are good opportunities for debt financing, particularly last-mile funding where you can enter and exit within two-and-a-half years,” Anuranjan Mohnot, managing director of Amplus Capital Advisors, told the financial daily.
Amplus Capital raised Rs 135 crore for its first realty fund in 2013. The fund has invested across eight projects in Bengaluru, Chennai, Pune and Ahmedabad, with prominent names in the real estate space including Shriram Properties, XS Real Properties and Assetz Homes.
For the second fund, the firm raised Rs 230 crore. The fund—which was raised in 2015-16—has made a couple of investments in Ahmedabad and is in the process of investing in Chennai. It is also looking at deals in Pune, according to Mohnot.
Amplus Capital is promoted by Jayesh Shah, director and CFO of Arvind Ltd, along with Lalbhai Group and Rohit Choksi, founder of accounting firm GK Choksi & Company.
The real estate market, especially the residential segment, has been going through a slowdown, with the need for capital on the rise. Debt players from the private equity space and non-banking financial companies have ramped up activity, given the state of the market.
In July, ASK Property Investment Advisors, the real estate private equity arm of ASK Group, marked the initial close of its seventh domestic fund—ASK Real Estate Special Situations Fund I—at Rs 535 crore ($83 million).
In June, financial services firm SMC Global Securities Ltd and asset management company IM+ Capitals Ltd launched a $75 million real estate fund focussed on the mid-size affordable housing segment.
The firms that have been raising private debt funds include UTI Asset Management Company which is aiming to raise as much as Rs 1,000 crore and financial services giant Edelweiss Group, which has floated its maiden credit vehicle. Avendus Finance Pvt. Ltd, the credit solutions arm of investment banking firm Avendus Capital Pvt. Ltd, has also launched a Rs 250-crore structured credit fund.
Other firms that have either launched or are floating structured credit platforms include Baring Private Equity Asia, State Bank of India and LICHFL Asset Management Co. Pvt. Ltd, a subsidiary of mortgage lender LIC Housing Finance Ltd.