Sundaram Alternates Closes First Corporate Credit Fund

29 Jun 2023 CW Team

Sundaram Alternates announced the first closing of its inaugural corporate credit fund, Sundaram Emerging Corporate Credit Opportunities Fund - Series I [ECCO I], at Rs 2.05 billion. The ECCO I und, which will be launched in June 2022, is a SEBI-approved category II AIF with a Rs 5 billion green shoe option.

The fund attracted participation from prominent family offices, corporate treasuries, and high net worth individuals [HNIs] and received approximately 40% subscription in the first close within 5 months of its introduction.

“With a focus on small and mid marked borrowers who are struggling to access capital from regular institutional lenders, ECCO I will invest via high yielding debentures and mezzanine securities in a portfolio of companies across MSME, SME, Fintech, Manufacturing, and Services. This is a space that has an estimated USD 4-7 billion credit demand in India,” the company said in a release.

With Sundaram Finance Group's backing, the fund will offer a differentiated value proposition in the market, with a unique fund design, stringent credit standards to preserve capital, and risk-adjusted return structures for investors.

Vikaas M Sachdeva, Managing Director, Sundaram Alternates, and Karthik Athreya, Director and Head of Strategy - Alternative credit- Sundaram Alternates, both commented on the first close, “Private credit in India is at an inflection point, and we see this asset class evolving significantly similar to globar markets. We are well-positioned to capitalize on new opportunities created by the current economic environment. India’s macros look favorable, and the country is set to become the fastest growing economy in the world. We look forward to receiving strong investor interest as well as finding attractive deployment opportunities for our strategy which is well positioned in this environment.”