Blacksoil targets Rs 500 crore final close for second credit fund

The firm has already secured Rs 300 crore and aims to achieve the full target within the next 6 to 9 months, according to Ankur Bansal, Managing Director (MD) of BlackSoil

Alternative credit platform BlackSoil is targeting a final close of its second fund, BlackSoil India Credit Fund II, at Rs 500 crore.

 

The firm has already secured Rs 300 crore and aims to achieve the full target within the next 6 to 9 months, Ankur Bansal, managing director (MD) of BlackSoil, told Business Standard.

 

The firm launched its first credit fund in November 2020 and began deploying capital in early 2021. Over nearly four years, the fund deployed Rs 540 crore from its initial raise of Rs 280 crore, through a redeployment strategy that reinvested returns.

 

Bansal said the deployment phase for the first fund is now complete, and the firm has already returned 75 per cent of the principal to its investors, marking the transition to the capital return phase.

 

“Our business has seen more than 25 per cent growth in terms of assets under management (AUM) or whether it is the number of clients which are coming and in our space, capital efficiency has been a very critical theme,” said Bansal.

 

“The requirement for our capital remains high because raising debt is easier than raising equity, there is no dilution happening,” he said.

 

Discussing the state of private credit in India, Bansal highlighted areas for improvement in the ecosystem. Recovery in cases of default can be challenging due to procedural delays, often caused by high caseload and limited resources.

 

He also pointed to the absence of a robust secondary debt market and limited participation from institutional investors. “There is not much appetite for private credit investment from pension funds, insurance companies, to raise capital. There are not many such institutional capital available that you can raise money domestically because awareness is relatively low,” Bansal said, adding that much of the funding currently comes from family offices and HNIs.

 

Bansal noted that while GDP growth rates may fluctuate, the impact on private credit remains limited, with sector-specific dynamics playing a more critical role. These do not fundamentally alter financing strategies unless there are signs of significant economic shifts, such as stagflation or a recession. He noted that rupee depreciation against the dollar poses a more immediate concern.