New Delhi: Market regulator, SEBI has allowed as many as 103 entities to set up AIFs - newly created class of pooled-in investment vehicles for real estate, private equity and hedge funds in less than two years. Out of the total registered Alternative Investment Funds (AIFs), around 13 entities got market regulator's approval to operate in the country so far this year as against 67 in 2013 and 22 in 2011.
The AIFs that have registered with SEBI included ICICI Prudential Debt Fund, Touchstone Trust, Lares Alpha Scheme. The regulator had notified in May 2012, the guidelines for this new class of market intermediaries but AIFs had started registering with Securities and Exchange Board of India (Sebi) from July 2012 and till yesterday around 103 AIFs have been allowed to set-up shop in the country. 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.
At the end of March 31, 2014, AIFs were committed to garner Rs 13,465 crore in 2013-14 and of this they raised Rs 4,569 crore and invested about Rs 3,348 crore during the period. 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. The Category-I AIFs are those funds that get incentives from the government, SEBI or other regulators and include Social Venture Funds, Infrastructure Funds, Venture Capital Funds and SME Funds.
The Category-III AIFs are those trading with a view to making short-term returns and it includes hedge funds, among others. 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, as also all others falling outside the ambit of categories I and III.
