HDFC AMC forays into private credit market with ₹2,500 crore fund

IFC will invest up to ₹220 crore as an anchor investor in HDFC AMC's Structured Credit Fund-I

HDFC Asset Management Company has forayed into the fast-growing private credit market with its new Structured Credit Fund-I, targeting mid-market companies with alternative debt financing.

The International Finance Corporation (IFC), a member of the World Bank Group, will invest up to ₹220 crore as an anchor investor in HDFC AMC's Structured Credit Fund-I, the asset management company said in its statement on Monday.

The fund has already secured about ₹1,290 crore in commitments in its first close, and is targeting a total corpus of ₹1,500 crore, with a green-shoe option of an additional ₹1,000 crore.

The commitment amount includes sponsor commitment from HDFC AMC of up to 14 per cent of the fund corpus.

 

The fund will invest in mid-market companies, and it has already committed ₹380 crore across three deals spanning various sectors. It will target mid-teen returns over a 4-6 year horizon.

HDFC AMC said that the fund will improve access to finance for underserved mid-market companies by providing alternative debt financing where traditional financing often faces limitations, supporting job creation and driving product and market innovation.

It will also help strengthen India's private credit ecosystem and support the scale-up of private credit for mid-market companies, HDFC AMC stated.