New Delhi, June 11 -- Avendus PE Investment Advisors Pvt Ltd, the asset management arm of Avendus Group, has mopped up additional capital for its third private credit fund after crossing the halfway mark earlier this year and has deployed more than half the amount secured so far, a senior executive told VCCircle.
The Avendus Structured Credit Fund III, which follows a high-yield performing credit strategy, has so far raised Rs 2,700 crore (around $282 million) from limited partners, said Anshul Jain, executive director at the fund.
Avendus aims to raise Rs 4,000 crore for the fund, divided equally between a base corpus and a greenshoe option. The fund marked its first close in April 2025 and opted to trigger the greenshoe option earlier this year. At the time, it said that it had already deployed about Rs 1,200 crore from the commitments received.
Jain said the firm has so far drawn down 60% of the commitments received for the fund. This suggests that the fund may have deployed around Rs 1,600 crore so far.
The fund received participation from existing investors, along with commitments from several new investors comprising domestic high-net-worth individuals and family offices. Avendus may mark the fund's final close in the next two quarters, Jain said.
The fund is sector-agnostic though its preferred sectors include pharmaceuticals, manufacturing, healthcare, consumer, chemicals, technology and B2B businesses. The typical deal sizes range from Rs 200-500 crore. Avendus is focussing on growth-stage companies with strong, differentiated models.
"The fund has completed seven investments so far, with an additional six to seven transactions expected over the investment period. Individual deal sizes are expected to range between 5% and 10% of the fund size," Jain said.
He said the fund is tracking an internal rate of return (IRR) of 18%. He did not disclose any specific details about the companies in which the fund has invested.
Jain also said Avendus would think of raising the next credit fund after deploying a substantial portion of the current vehicle. "As a matter of industry practice, managers typically launch a successor fund once 75-80% of the preceding fund has been deployed. We intend to follow a similar approach and will look to launch Fund IV once Fund III reaches that level of deployment," he said.
The Avendus Structured Credit Fund II had a target of Rs 1,000 crore. It eventually raised Rs 1,055 crore and invested in 14 companies. The fund is fully deployed and has already returned around 60% of the principal capital, along with periodic income distributions. The fund is currently tracking an IRR of 17.5-18%, VCCircle has learnt.
Avendus Structured Credit Fund I raised Rs 135 crore and deployed capital across nine transactions. The fund has been fully exited and distributed to investors, achieving gross portfolio-level returns of 18% over its investment period.
Avendus Group, founded in 1999, operates across investment banking, institutional equities, wealth management, credit solutions, and asset management, with a presence in India, US, and Singapore. In December last year, Japan's Mizuho agreed to acquire a majority stake in Avendus from private equity firm KKR and other shareholders.
Published by HT Digital Content Services with permission from VC Circle.