Mumbai-based portfolio and asset management company, Alchemy Capital Management Pvt. Ltd, on Tuesday announced the launch of its new category-III alternative investment fund (AIF) aiming to raise upwards of Rs 500 crore over a tenure of four years.
The Alchemy Emerging Leaders Of Tomorrow fund will include a sector-agnostic portfolio of 20-25 stocks, that will largely focus on small and midcap companies with minimum 65% allocation, a statement said. The portfolio will also include investments in large cap and 10% allocation will be for IPO opportunities, it added.
The final close of the fund will be in December 2022, the company said without disclosing information on the quantum of the first close.
The firm aims to raise capital from resident and non-resident Indians, high net worth individuals (HNIs), Hindu undivided Family (HUF), banks, accredited investors and trusts, and will be managed by co-founder and chief executive officer, Hiren Ved and colleague Mythili Balakrishnan.
Balakrishnan has over 19 years of experience in finance and markets, especially in equity analysis and fund management.
“India is at the cusp of a solid economic recovery led by manufacturing and digital-led businesses. While investors have already played the consolidation story of backing current leaders, our aim is to bet on entrepreneurs with more agile and innovative business models,” Hiren Ved said in the statement.
Back in January 2022, Ved had told Mint in an interaction, “We are not buying small and midcaps that will become large caps. What we are saying is that companies that will lead next 5-10 years will not necessarily be the leaders of the past. Every 8-10 years, leadership changes because of business cycles, new entrepreneurs coming in and creating a competitive edge.”
The fund’s first subscription period closes on 30 September 2022, followed by subsequent closing on fortnightly basis, or such other date as decided by the Investment Manager. The investors will have a horizon of about 3-5 years.
“We believe that India is entering a phase of broad-based growth and the small and the midcap spaces in India offer an opportunity to make attractive returns,” said Balakrishnan in a statement.
“Also, the small and mid-sized businesses have undergone multiple stressors over the past few years but have emerged stronger and are well placed to take advantage of the current demand environment,” she added.
Founded in 1999 by Rakesh Jhunjhunwala, Lashit Sanghvi, Ashwin Kedia and Hired Ved, Alchemy currently manages assets worth $914 million serving about 2,650 clients.
In its two decade-history, the investment management company has managed funds including Alchemy Leaders of Tomorrow, Alchemy Ascent, Alchemy High Growth Select Stock and Alchemy High Growth.
The previous fund – Alchemy Leaders of Tomorrow – which matured on 29 November 2021 gave a compound annual growth rate of 22.1% since its inception vs the benchmark S&P BSE 500 index’s return of 17.4%.