Abhay Laijawala, a former head of Deutsche Securities India, has joined Avendus Capital Public Markets Alternate Strategies LLP to lead the financial services firm’s new environment, social and governance (ESG) fund.
Laijawala joined KRR-controlled Avendus about two months ago, after having spent 10 years heading the equities vertical for the German bank in Mumbai, primarily leading the research and strategy division.
Laijawala will manage the ESG fund, which was announced on Thursday and which will look to invest in India’s public equity markets.
The fund, yet to have an official name, is housed under Avendus Capital Public Markets Alternate Strategies, the alternative asset management arm of Avendus Capital.
Avendus Capital is led by chairman Alok Vajpeyi, the former head for Daiwa Capital in India.
Before this, Avendus’ alternate investment vertical had floated two funds in the past 15 months and has assets under management (AUM) of more than Rs 6,800 crore (around $960 million at current exchange rates).
Andrew Holland, the chief executive officer (CEO) of Avendus Capital Public Markets Alternate Strategies LLP, said that the new vehicle is the first such ESG fund in India and it is important to get the framework in place.
“ESG is a responsible way of investing and is a growing trend in Europe and the US. In India, it will take some time and it is a slow process in terms of educating the investors and market,” Holland said, adding that the fund aims to have $1 billion in AUM over the next three years.
The fund will be launched in late-October and Holland anticipates more offshore activity to begin with.
“Locally, we will probably launch the fund through a PMS [portfolio management service] scheme,” he said.
Avendus also announced that the firm had exclusively tied up with proxy advisory firm Institutional Investor Advisory Services (IiAS) to set up a robust ranking framework covering ESG principles.
It has appointed former Reserve Bank of India deputy governor Dr Rakesh Mohan and IiAS’ Amit Tandon on the ESG fund’s advisory board.
The public market alternative strategies business manages two funds—Avendus Absolute Return Fund (Rs 4,400 crore in AUM) and Avendus Enhanced Return Fund (Rs 2,400 crore in AUM).
The Avendus Absolute Return Fund is a hedge fund registered with the capital markets regulator Securities and Exchange Board of India as a Category-III alternative investment fund. It has assets under management of $510 million.
The hedge fund is managed by CEOs Andrew Holland and Vaibhav Sanghvi and was launched in February last year. It has been tapping into a network of high-net-worth individuals, multi-family offices and corporate treasuries to raise the corpus.
The Avendus Enhanced Return Fund has assets under management of $117 million, the company said, without disclosing any details.
Avendus has hired several executives over the past year-and-a-half to lead various businesses. It had recruited Holland from Ambit Investment Advisory in September 2016. The same year, it hired Dhiren Mehta from KKR to grow its credit business and Sandeep Thapliyal from RBL Bank to head its non-banking financial business.
In March 2017, Avendus appointed Akash Hariani to lead its multi-family office business. In July, it named Motilal Oswal Financial Services Ltd’s Sameer Kamath as group chief financial officer. Just last month, Avendus appointed Sudeepto Deb as executive director and head of equities at its wealth management subsidiary.
