Franklin Templeton Investments has launched an alternative investment fund (AIF), the group company of Franklin Templeton Mutual Fund said in a statement.
The fund, Franklin India Long Short Equity AIF, would be housed under the Franklin Templeton Alternative Investments (India) Pvt. Ltd, which previously managed now-inoperative private equity entity Darby Asia Investors (India) Pvt. Ltd, a unit of Franklin Templeton Investments.
The Category-III open-end fund intends to generate capital appreciation over the medium to long term by investing in equity, equity-related securities and derivatives of companies domiciled in India.
Naganath Sundaresan, president and investment chief, Franklin Templeton Alternative Investments, said, “The AIF industry in India has witnessed significant growth momentum in the past two years as high net worth individuals and family offices seek new and niche investment strategies for their portfolios.”
VCCircle had reported in November last year the appointment of Sundaresan as the head of Franklin Templeton Mutual Fund’s India AIF division.
Market regulator Securities and Exchange Board of India (SEBI) streamlined and beefed up rules for AIFs in 2012. Since then, more than 450 AIFs have registered with SEBI.
VCCircle had reported in September how a growing number of wealthy persons are pumping money in AIFs.
Typically, an AIF is not allowed to receive an investment of less than Rs 1 crore from an investor. Also, the fund or any scheme of the fund is not allowed to have more than 1,000 investors, according to SEBI rules.
Franklin’s fund is on a growing list of AIF funds that have already been floated or are on the verge of being floated.
Old Bridge Capital Management, the portfolio management services firm founded by former IDFC Asset Management Co. investment chief Kenneth Andrade, raised over Rs 1,000 crore from investors after floating an AIF last December.
In February 2017, KKR-backed financial services firm Avendus Group launched a hedge fund after hiring the core team that managed Mumbai-based Ambit Holdings’ asset management business. While the team led by Andrew Holland shifted to Avendus, financial services group Edelweiss acquired Ambit Investment Advisors' flagship hedge fund, Ambit Alpha Fund.