New Delhi, June 30 -- Limited partners (LPs), who had been committing an average of $3-5 billion each quarter over the past two years, broke the bank to make record fresh commitments to India-focussed private equity (PE), private credit and venture capital (VC) funds in the three months ended March 31, 2026, according to VCCircle estimates based on official data.
LPs made fresh commitments of Rs 1.17 trillion ($12.5 billion), with the bulk of the capital being channelled to PE and credit funds during the first three months of the year.
This is only the second time in a quarter that LPs have committed over Rs 1 trillion to PE, VC and credit funds. While the dollar figure matches the amount committed in the last quarter of 2023, in rupee terms (given that the bulk of the new raise now happens domestically), it is way above the previous peak of Rs 1.05 trillion.
The Indian currency has depreciated sharply over the past two years, and the same dollar amount now brings more rupees to deploy in the country.
As a result, the cumulative capital committed by LPs, including institutional investors, high-net-worth individuals (HNIs) and family offices, to PE, VC and private credit funds has touched the $147-billion mark.
This data, compiled using the Securities and Exchange Board of India's (SEBI's) statistics for alternative investment funds (AIFs) registered in India, includes information on Category I and Category II funds.
Category I represents angel, VC and infrastructure funds, while Category II includes private equity and private credit funds.
Category III funds, which represent public market-focussed investment vehicles, separately received additional commitments of Rs 2,769 crore (just under $300 million). This is the lowest fresh commitment to public market-focussed funds in over three years.
In 2022, LPs had shown a propensity to back off from commitments to public market-focussed AIFs, arguably to go direct with their stock market bets as markets corrected sharply in the first half of the year despite the receding impact of the COVID-19 shakeup.
Dry powder
With the continuing build-up of LP appetite for Indian private investments, the dry powder - or capital available to be deployed, including the quantum that PE and VC funds had not yet "called in" - jumped to a new high.
Dry powder for PE, VC and credit funds rose to Rs 9.16 trillion (around $97 billion). Of this, the chunk for local VCs, in particular, is pegged at around $3.8 billion.
The overall dry powder may include components of funds that have not formally announced a closure but have received LP commitments.
To be sure, the data captures only funds registered in India under SEBI's AIF regime and excludes internationally-domiciled fund houses.
To that extent, it doesn't reflect the entire investment climate in India but only outlines broader trends.
Published by HT Digital Content Services with permission from VC Circle.