Wealth creation? Emkay bets on India's IPO boom with New Emerging Stars AIF

Emkay Investment Managers has launched Emkay Emerging Stars Fund – Series VII, a Sebi-registered Category III Alternative Investment Fund, positioning it as a vehicle to capture India’s next decade of growth across listed equities and select pre-IPO opportunities.

 

A core differentiator of Emkay Emerging Stars Fund – Series VII is its ability to participate in India’s rapidly expanding pre-IPO landscape, with upto 35% investment in unlisted/pre-IPO opportunities.

 

With strong domestic capital pools and robust retail participation, pre-IPO investing has emerged as a high-potential avenue for alpha generation, especially when backed by disciplined selection.

 

"Emkay Emerging Stars Fund – Series VII will identify opportunities in businesses with strong fundamentals and defined liquidity timelines at relatively attractive valuations opportunities, 6–9 months before IPO filing. This strategy is particularly timely given India’s surge in primary market activity. The country now accounts for 32.5% of global IPO volumes, up from 5.8% in 2019," it said in a statement.

 

 

At its core, the fund is built around five long-duration themes reshaping India’s growth trajectory: digitalisation, financialisation of savings, artificial intelligence, manufacturing, and the energy transition. 

 

India’s expanding digital backbone—now nearing 900 million internet users—along with record UPI transaction volumes, is drawing more consumers and enterprises into the formal economy. Parallel shifts in AI adoption, manufacturing scale-up and renewable energy investments are expected to influence sector leadership and capital allocation over the coming decade.

 

A key pillar of the strategy is Emkay’s proprietary E-Qual Framework, a governance-first, data-driven evaluation model refined over the past decade. The framework objectively assesses management integrity, capability, wealth distribution practices, investor communication and liquidity, while a detailed risk–reward matrix helps filter out companies with governance gaps, excessive leverage or structural red flags.

 

“The fund is launching at a time when India is entering what we see as a ‘golden decade’,” said Manish Sonthalia, Chief Investment Officer at Emkay Investment Managers. He pointed to the convergence of favourable demographics, policy support and long-duration growth drivers—from financialisation and consumption to digitisation, AI and energy transition—as a compelling backdrop for long-term equity returns.

 

Emkay Emerging Stars Fund – Series VII aims to construct a diversified portfolio across market capitalisations and sectors, blending listed equities with selective pre-IPO exposure. Companies will be screened on quality, valuation discipline and size-adjusted return potential, with active elimination of risks such as high promoter pledging, weak disclosures and over-leverage.

 

The close-ended fund is benchmarked against the BSE 500 TRI, with an investment horizon of two years and above. It offers fortnightly subscriptions and quarterly redemptions, with exit loads of 3% within 24 months of final drawdown and 2% thereafter. The fund will be jointly managed by Sonthalia and Kashyap Javeri, Co-Fund Manager.

 

Fund Overview

 

Launched by Emkay Investment Managers Limited, the asset management arm of Emkay Global Financial Services.

 

SEBI-registered Category III, close-ended AIF.

 

• Objective: Long-term capital appreciation through listed equities and selective pre-IPO investments.
• Benchmark: BSE 500 TRI.
• Investment horizon: 2 years and above.
• Pre-IPO Strategy (Core Differentiator)
• Up to 35% exposure allowed in unlisted / pre-IPO opportunities.
• Focus on late-stage companies identified 6–9 months before IPO filing.

 

Targets businesses with:

 

• Proven revenues and earnings visibility
• Defined liquidity timelines (IPO within 6–18 months)
• Relatively discounted pre-listing valuations
• Designed to capture alpha from India’s booming primary markets.
• India’s share of global IPOs has risen from 5.8% (2019) to 32.5% (2025 YTD).
• India ranked No.1 globally in IPO volumes, supported by strong domestic capital and retail participation.

 

India Growth Thesis: “Golden Decade”

 

The fund is anchored around five structural growth themes expected to shape India over the next decade:

 

• Financialisation of savings
• Consumption growth
• Digitisation and AI adoption
• Manufacturing expansion (Make in India, China+1)
• Energy transition and renewables
• These themes are backed by favourable demographics, policy support, rising incomes and expanding digital infrastructure.

 

Investment Philosophy

 

• Long-term investing with a buy-and-hold mindset.
• Strong emphasis on purchase price discipline.
• Focused portfolios to avoid over-diversification.

 

Avoids:

 

• Highly leveraged companies
• Euphoria-driven valuations
• Weak governance structures

 

Sector & Market Cap Allocation

 

• Flexible allocation across large, mid and small caps.
• Portfolio diversified across sectors aligned to long-term themes.
• Combines stability of listed equities with upside from pre-IPO exposure.