100 AIFs had targeted to raise over Rs 13,000 cr in FY'14

About 100 AIFs - newly created class of pooled-in investment vehicles for real estate, private equity and hedge funds - are targeted to mop-up over Rs 13,000 crore in 2013-14.

This was sharply higher than the target of Rs 1,544 crore at the end of March 31, 2013.According to information available with market regulator Sebi, Alternative Investment Funds (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.

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.

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 since then around 100 AIFs have been allowed to set-up shop in the country.

At the end of September 2012, AIFs had committed to mop-up just Rs 326 crore and the figure rose to Rs 359 crore by the end of 2012. Since then, the number has been consistently moving in the upward direction.

AIFs had targeted to garner Rs 1,544 crore at March-end 2013 as compared to Rs 13,465 crore at the end of March this year.

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, among others.

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 II.