The regulator had notified in May 2012, the guidelines for this new class of market intermediaries. AIFs are basically funds established or incorporated in India for the purpose of pooling in capital from Indian and foreign investors for investing as per a pre-decided policy.
In August last year, Sebi decided that the promoters of listed companies can offload 10 per cent of their equity to AIFs such as such as SME Funds, Infrastructure Funds, PE funds and Venture Capital Funds registered with it so as to meet the norm of having a minimum of 25 per cent public holding.
Under Sebi guidelines, AIFs can operate broadly in three categories. The Sebi rules apply to all AIFs, including those operating as private equity funds, real estate funds and hedge funds, among others.
The Category I AIFs include Social Venture Funds, Infrastructure Funds, Venture Capital Funds and SME Funds are those funds that get incentives from the government, Sebi or other regulators.
The Category-III AIFs are those trading with a view to making short-term returns and it includes hedge funds, among others.
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The Category-II AIFs can invest anywhere in any combination but are prohibited from raising debt, except for meeting their day-to-day operational requirements.
These AIFs include private equity funds, debt funds or fund of funds, as also all others falling outside the ambit of two other categories.
As per the latest data available with Sebi, Category I registered a rise of 9.8% in total investment made. While the category II saw more than 100% rise in investments made to Rs 2479.6 crore in quarter ended March 2014 from December 2013 quarter. Further, the category III recorded a rise of 35%.
Under the category I, highest investment was by infrastructure fund at Rs 170.25 crore, followed by Social Venture Fund at Rs 38.91 crore and Venture Capital Fund at Rs 14.68 crore, while there was no investments made under SME Funds.
The total commitments raised were Rs 13465 crore under all the three categories, while the fund raised was Rs 4569.1 crore in March 2014 quarter.
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