Neo Asset Management has made the first close of its Rs 2,000 crore private equity fund, the Neo Secondaries Fund, after raising Rs 750 crore from investors, cofounder and chief executive Hemant Daga told ET.
The Securities and Exchange Board of India-registered Category-II alternative investment fund focuses on acquiring secondary stakes in unlisted Indian companies. It focuses on companies that are profitable at before interest, taxes, depreciation and amortisation and offer an exit pathway within two to four years.
Neo Asset Management is the asset management arm of Neo Group, which manages more than Rs 13,500 crore across private equity, credit and infrastructure. It counts Peak XV Partners, MUFG and Euclidean Capital among its backers.
“Secondaries have outperformed in the US. It has outperformed their public markets by up to 7% per annum. In India, secondaries outperform public markets by 6-8% per annum, that is a healthy outperformance,” said Daga. “These funds are of relatively shorter duration, unlike a traditional private equity fund.”
Explaining the rationale for launching a late-stage secondaries fund, Daga said it offers more visible returns and helps provide liquidity to existing investors as the original fund approaches the end of its life.
A secondary fund is a type of investment fund that buys stakes in private companies or private equity funds from current investors, rather than investing directly in new startups or companies.
The fund has already closed three investments: in disposable hygiene products manufacturer Noble Hygiene, beauty and personal care marketplace Purplle and Mumbai-based artificial intelligence firm Fractal Analytics. It has also signed a multi-asset deal with an Indian venture capital firm. Daga did not disclose the name of this firm.
Launched in 2021 by Nitin Jain, who was previously chief executive at Edelweiss Financial Services, along with his four colleagues at Edelweiss, Neo offers financial advisory services to around 1,200 clients across the high net worth to ultra-high-net-worth consumers and multi-family office segments.
In August last year, it raised Rs 400 crore in a fresh equity funding round led by Japanese lender MUFG Bank along with New York-based Euclidean Capital. Peak XV Partners, which had invested around $35 million in October 2023, also participated in this round.
In the same month, Neo Asset Management announced the appointment of Nitin Agarwal as the head of private equity. Prior to joining Neo, Agarwal headed the India operations at TPG NewQuest, a secondary private equity fund.
The Securities and Exchange Board of India-registered Category-II alternative investment fund focuses on acquiring secondary stakes in unlisted Indian companies. It focuses on companies that are profitable at before interest, taxes, depreciation and amortisation and offer an exit pathway within two to four years.
Neo Asset Management is the asset management arm of Neo Group, which manages more than Rs 13,500 crore across private equity, credit and infrastructure. It counts Peak XV Partners, MUFG and Euclidean Capital among its backers.
“Secondaries have outperformed in the US. It has outperformed their public markets by up to 7% per annum. In India, secondaries outperform public markets by 6-8% per annum, that is a healthy outperformance,” said Daga. “These funds are of relatively shorter duration, unlike a traditional private equity fund.”
Explaining the rationale for launching a late-stage secondaries fund, Daga said it offers more visible returns and helps provide liquidity to existing investors as the original fund approaches the end of its life.
A secondary fund is a type of investment fund that buys stakes in private companies or private equity funds from current investors, rather than investing directly in new startups or companies.
The fund has already closed three investments: in disposable hygiene products manufacturer Noble Hygiene, beauty and personal care marketplace Purplle and Mumbai-based artificial intelligence firm Fractal Analytics. It has also signed a multi-asset deal with an Indian venture capital firm. Daga did not disclose the name of this firm.
Launched in 2021 by Nitin Jain, who was previously chief executive at Edelweiss Financial Services, along with his four colleagues at Edelweiss, Neo offers financial advisory services to around 1,200 clients across the high net worth to ultra-high-net-worth consumers and multi-family office segments.
In August last year, it raised Rs 400 crore in a fresh equity funding round led by Japanese lender MUFG Bank along with New York-based Euclidean Capital. Peak XV Partners, which had invested around $35 million in October 2023, also participated in this round.
In the same month, Neo Asset Management announced the appointment of Nitin Agarwal as the head of private equity. Prior to joining Neo, Agarwal headed the India operations at TPG NewQuest, a secondary private equity fund.