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Economic Times
5 days ago
- Business
- Economic Times
Vivriti's Vintage I delivered 15.5% IRR—Here's how it navigated crisis and liquidity tightening
In a market environment riddled with pandemic-induced volatility, corporate credit stress, and tightening liquidity, delivering consistent returns was no easy feat. Yet, Vivriti Asset Management's Vintage I fund not only preserved capital but delivered a stellar gross IRR of 15.5%. In this edition of ETMarkets AIF Talk, Dipen Ruparelia, Head of Products at Vivriti AM, reveals how the firm's laser-sharp focus on private credit, disciplined portfolio construction, and proactive risk management helped navigate one of the most challenging investment periods in recent history—while staying true to its investor commitments. Edited Excerpts - ADVERTISEMENT Q) Vivriti Asset Management has returned over Rs.2,000 crore to clients so far. What has been the key driver behind this performance?A) Vivriti Asset Management, throughout its journey and since inception in 2019, has stayed focused only on private credit as a strategy and has managed funds true to its label. What has worked for us is a) identifying a deep structural opportunity in mid-market corporate lending (11-16% yield bracket) way back in 2019, b) setting up a private credit-focused AMC much earlier, and c) investing well in people and processes. We are proud to say that we have returned full capital and returns (beating investor communication) across three full scheme exits in Vintage 1. Our Vintage 2 funds are also in the run-down phase, where we have returned some capital, and full payback of principal is expected by Sep 26. Q) Your portfolios span infrastructure, logistics, financials, SaaS, and commercial real estate. What sectors do you find most promising in the current economic environment? A) Yes, we run diversified, sector-agnostic domestic fund mandates. Till date, we have invested in ~20 sectors, including airports, regional airlines, roads, renewable energy, co-working, smart meter manufacturing, and financials, among others. ADVERTISEMENT While our deals are more bottom-up selection, a few of the promising sectors are renewables, infrastructure, logistics, and warehousing, where we are seeing the maximum amount of capex are cautious on sectors which has greater external linkage due to ongoing global trade tensions and sectors like gems and jewellery, media, textiles, etc., due to historical governance issues in the sector. Q) Vintage I funds have delivered a gross IRR of up to 15.5%. How did you manage to generate such attractive risk-adjusted returns? ADVERTISEMENT A) Vintage Fund - I was launched in and around the pandemic times, in the aftermath of corporate crises of 2018, deployed mostly through 2020-21 battling uncertainties of modelling risks, and exited through 2023-24 amidst higher interest rates and tighter ability of the funds to generate attractive risk-adjusted returns is attributed to:• Our relentless eye on the macroeconomic environment leading us to pre-empt sector-level issues, guiding portfolio construction. ADVERTISEMENT • Primary asset origination and control on deal structuring to have greater control over the investee firms.• A strong focus on risk control, tracking portfolio performance, and acting on deviations, when needed.• Following a clear exit strategy, mostly through cashflows of the investee firms. Q) With the Diversified Bond Fund (Vintage III) targeting 15–16% gross IRR, what types of mid-sized firms are you focusing on, and how do you manage credit risk? ADVERTISEMENT A) The investee companies in Diversified Bond Fund Series II (Vintage III) are typically performing mid-market entities with proven business models, vintage of 7-10+ years, wherein they seek flexible debt from private credit funds like us as either the end-use isn't bankable or traditional lenders banks aren't able to create bespoke solutions which is required in a time-bound manner by the investee credit underwriting, control on deal terms, structuring, security, tighter covenants, un-compromised access to data, systems, and management, regular monitoring of portfolio companies, and pre-emptive decision making are the key pillars of our credit risk management. Q) What is semi-liquid private credit AIFs and how is it different from traditional closed-ended AIFs? A) Semi-liquid funds are an innovative investment vehicle that combines the benefits of both open-ended and close-ended funds while giving access to private markets to funds are structured as perpetual funds, giving the flexibility to investors to subscribe and redeem at regular pre-defined compared to typical close-ended private credit funds, Semi-Liquid scores better on:• Ability to see a 'build portfolio' when investing:o Given perpetual vehicle and being continuously available for subscription, an investor sees a 'build portfolio' with a track record since inception.o Close-ended funds have a limited availability period and a shelf life. They are also known as 'Blind-pool' funds as most of the investors enter with limited portfolio creation.• Quick access to private markets & no opportunity loss:o Semi-liquid funds don't follow a drawdown structure, which ensure full investment for investors in private credit markets.o Typical close-ended funds draw down capital over a 12-24 month period from initial close, thereby creating opportunity loss for investors till full capital is drawn down.• Option to receive regular income or allow compounding of income at the instance of the investor, which is not possible in close-ended funds.• Liquidity option and redemption of invested capital, when required by the investor versus run-down of fund in the last 1.5-2 years in multiple tranches in close-ended funds. Q) How do you balance the need for liquidity with maintaining portfolio returns in your semi-liquid and open-ended strategies? A) The investment strategy of semi-liquid funds is to invest in relatively shorter tenor amortising deals of mid-corporate liquidity aspect is managed through investing a small portion in cash and cash equivalent instruments, while a large part of liquidity is self-generating through principal amortisation across all the portfolio entities, tied to the frequency and redemption dates of the investors who have remained invested in the fund for the initial brief period till exit load implications, redemption of invested capital will come without any impact cost, subject to other redemption terms. Q) Who are semi-liquid private credit funds best suited for, and how are they addressing the unique liquidity concerns of HNIs, UHNIs, and family offices? A) Semi-liquid private credit funds are specially crafted for HNIs/UHNIs, investing typically from their individual, trust, or LLP A/cs. They are attractive for investors who area) looking at core debt allocation for an investment horizon of 1+ year OR investors who aren't comfortable locking in the capital for 4-6 years (which typical close-ended funds entail).b) looking for a post-tax, post-fees and expense return of 7% to 8% p.a from a diversified portfolio across multiple entities, run by a professional asset manager. It is also suitable for investors who prefer the flexibility of cashflows at their instance:i) Commit and deploy full capital in one single Receive predictable and stable regular income cashflows ORiii) Re-deploy the income and compound the income at a similar return profile without any hassle/delay. iv) Take out the invested capital along with income in a single tranche, subject to the redemption frequency and terms of the fund. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Time of India
5 days ago
- Business
- Time of India
Vivriti's Vintage I delivered 15.5% IRR—Here's how it navigated crisis and liquidity tightening
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel In a market environment riddled with pandemic-induced volatility, corporate credit stress, and tightening liquidity , delivering consistent returns was no easy Vivriti Asset Management 's Vintage I fund not only preserved capital but delivered a stellar gross IRR of 15.5%.In this edition of ETMarkets AIF Talk, Dipen Ruparelia, Head of Products at Vivriti AM, reveals how the firm's laser-sharp focus on private credit, disciplined portfolio construction, and proactive risk management helped navigate one of the most challenging investment periods in recent history—while staying true to its investor commitments. Edited Excerpts -A) Vivriti Asset Management, throughout its journey and since inception in 2019, has stayed focused only on private credit as a strategy and has managed funds true to its has worked for us is a) identifying a deep structural opportunity in mid-market corporate lending (11-16% yield bracket) way back in 2019, b) setting up a private credit-focused AMC much earlier, and c) investing well in people and are proud to say that we have returned full capital and returns (beating investor communication) across three full scheme exits in Vintage 1. Our Vintage 2 funds are also in the run-down phase, where we have returned some capital, and full payback of principal is expected by Sep 26.A) Yes, we run diversified, sector-agnostic domestic fund mandates. Till date, we have invested in ~20 sectors, including airports, regional airlines, roads, renewable energy, co-working, smart meter manufacturing, and financials, among our deals are more bottom-up selection, a few of the promising sectors are renewables, infrastructure, logistics, and warehousing, where we are seeing the maximum amount of capex are cautious on sectors which has greater external linkage due to ongoing global trade tensions and sectors like gems and jewellery, media, textiles, etc., due to historical governance issues in the sector.A) Vintage Fund - I was launched in and around the pandemic times, in the aftermath of corporate crises of 2018, deployed mostly through 2020-21 battling uncertainties of modelling risks, and exited through 2023-24 amidst higher interest rates and tighter ability of the funds to generate attractive risk-adjusted returns is attributed to:• Our relentless eye on the macroeconomic environment leading us to pre-empt sector-level issues, guiding portfolio construction.• Primary asset origination and control on deal structuring to have greater control over the investee firms.• A strong focus on risk control, tracking portfolio performance, and acting on deviations, when needed.• Following a clear exit strategy, mostly through cashflows of the investee firms.A) The investee companies in Diversified Bond Fund Series II (Vintage III) are typically performing mid-market entities with proven business models, vintage of 7-10+ years, wherein they seek flexible debt from private credit funds like us as either the end-use isn't bankable or traditional lenders banks aren't able to create bespoke solutions which is required in a time-bound manner by the investee credit underwriting, control on deal terms, structuring, security, tighter covenants, un-compromised access to data, systems, and management, regular monitoring of portfolio companies, and pre-emptive decision making are the key pillars of our credit risk management.A) Semi-liquid funds are an innovative investment vehicle that combines the benefits of both open-ended and close-ended funds while giving access to private markets to funds are structured as perpetual funds, giving the flexibility to investors to subscribe and redeem at regular pre-defined compared to typical close-ended private credit funds, Semi-Liquid scores better on:• Ability to see a 'build portfolio' when investing:o Given perpetual vehicle and being continuously available for subscription, an investor sees a 'build portfolio' with a track record since inception.o Close-ended funds have a limited availability period and a shelf life. They are also known as 'Blind-pool' funds as most of the investors enter with limited portfolio creation.• Quick access to private markets & no opportunity loss:o Semi-liquid funds don't follow a drawdown structure, which ensure full investment for investors in private credit markets.o Typical close-ended funds draw down capital over a 12-24 month period from initial close, thereby creating opportunity loss for investors till full capital is drawn down.• Option to receive regular income or allow compounding of income at the instance of the investor, which is not possible in close-ended funds.• Liquidity option and redemption of invested capital, when required by the investor versus run-down of fund in the last 1.5-2 years in multiple tranches in close-ended funds.A) The investment strategy of semi-liquid funds is to invest in relatively shorter tenor amortising deals of mid-corporate liquidity aspect is managed through investing a small portion in cash and cash equivalent instruments, while a large part of liquidity is self-generating through principal amortisation across all the portfolio entities, tied to the frequency and redemption dates of the investors who have remained invested in the fund for the initial brief period till exit load implications, redemption of invested capital will come without any impact cost, subject to other redemption terms.A) Semi-liquid private credit funds are specially crafted for HNIs/UHNIs, investing typically from their individual, trust, or LLP A/cs. They are attractive for investors who area) looking at core debt allocation for an investment horizon of 1+ year OR investors who aren't comfortable locking in the capital for 4-6 years (which typical close-ended funds entail).b) looking for a post-tax, post-fees and expense return of 7% to 8% p.a from a diversified portfolio across multiple entities, run by a professional asset is also suitable for investors who prefer the flexibility of cashflows at their instance:i) Commit and deploy full capital in one single Receive predictable and stable regular income cashflows ORiii) Re-deploy the income and compound the income at a similar return profile without any hassle/ Take out the invested capital along with income in a single tranche, subject to the redemption frequency and terms of the fund.(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Entrepreneur
20-05-2025
- Business
- Entrepreneur
Vivriti Asset Management Secures USD 20 Mn from Austria's OeEB
The Austrian development bank's investment aligns with its 2024–2028 strategy centered on green finance, SME development, and gender inclusion. You're reading Entrepreneur India, an international franchise of Entrepreneur Media. Vivriti Asset Management (VAM) has received USD 20 million commitment from the Development Bank of Austria (OeEB) for its Vivriti India Retail Assets Fund (VIRAF), raising the fund's capital base to USD 165 million. The fund, launched in March 2023 at GIFT City, aims to close with a corpus of USD 250 million. VIRAF is an asset-backed securitisation (ABS) fund focused on expanding access to retail and MSME credit in India, particularly for women and underserved communities. A significant majority of borrowers through VIRAF-backed financial institutions are women. "OeEB's capital will directly strengthen our ability to extend funding to high-quality financial institutions that are empowering women and small businesses across India," said Vineet Sukumar, Founder and Managing Director of VAM. "At VAM, we continue to innovate in structured credit to bridge the country's credit gap while delivering risk-adjusted returns to investors." The Austrian development bank's investment aligns with its 2024–2028 strategy centered on green finance, SME development, and gender inclusion. "Promoting small and medium-sized enterprises and financial inclusion as well as gender equality are among the focus areas of our strategy. Therefore, we are very pleased to provide additional financing for VIRAF and look forward to contributing to India's inclusive economic growth," said Sabine Gaber, Member of the Executive Board at OeEB. So far, VIRAF has disbursed over USD 200 million through 25 NBFCs, reaching more than 350,000 individuals and 100,000 MSMEs—over 75% of whom are women. With OeEB's participation, VIRAF now boasts a strong investor base including British International Investment, Calvert Impact, M&G Catalyst, and the International Finance Corporation. Vivriti aims to deploy over USD 1 billion in retail ABS over the next decade, reinforcing its position as a structured credit innovator in India.
