How Japan's capital pivot helped ChrysCap raise record $2.2 billion fund

“We’ve seen some other firms take risks that, at the time, we weren’t comfortable taking. But they worked out really well for them. So now we’re looking at whether there are specific situations where we, too, can take more risk," said Chatterjee, who leads fundraising and limited partner (LP) relationships.

He said the firm’s risk appetite is rising in situations where ChrysCapital can back companies with weaker operations, step in, fix them and create value.

This comes at a time when PE firms are actively scouting for buyouts of traditional, legacy businesses that have the potential to generate higher returns after restructuring.

PE firms typically target “an alpha of at least 4-5% above public market returns," said Bharat Anand, senior partner at law firm Khaitan & Co.

Strategies vary by sector, deal size and capabilities. “Managers are fundamentally driven by the need to maximize returns and will not shy away from restructuring at the time of investment or exit", if it improves outcomes, he added.

Restructuring deals, which are typically routed through feeder funds that pool investor money into a master fund, demand a large stake and strong control rights to justify their higher costs and tax exposure, Anand added.

While Chatterjee said India is now ripe for buyouts, with more promoters willing to cede control, the firm is also open to restructuring in minority deals.

“Even in a minority deal, if the entrepreneur acknowledges the problems and is committed to fixing them, that’s also a business we could consider backing," he said.

“The need to restructure is a means to an end, but not an end in itself," Anand said. Whether minority or buyout, returns drive the decision.

Manufacturing back in the picture

ChrysCapital is returning to manufacturing after nearly five years, Chatterjee said. The firm stepped back from the sector around 2019-20, when information technology (IT) services, financial services and healthcare offered better risk-reward.

That has changed. Supply chains are shifting out of China, India’s labour force is expanding, and the government is pushing domestic manufacturing. “The next phase of India’s growth has to be driven by manufacturing," he said.

The firm is evaluating deals across electronics manufacturing services, components and data centre supply chains—the “picks and shovels of the AI (artificial intelligence) revolution."

It has already made one commitment. In September 2025, ILJIN Electronics India, a subsidiary of the Amber Group, raised ₹1,200 crore from ChrysCapital and InCred Growth Partners.

A Moneycontrol report stated that ChrysCapital has emerged as the leading contender for a significant minority stake in Nash Industries.

Shift in stance

One of India’s oldest homegrown PE firms, ChrysCapital invests across the enterprise technology, financial services, healthcare and consumer sectors, with notable companies such as the National Stock Exchange, Hero FinCorp, Theobroma and Intas Pharma.

Since its inception in 1999, the Ashish Dhawan-founded firm has raised $5 billion across its first nine funds, invested nearly $4.5 billion in over 100 companies, and realized about $7 billion across roughly 80 exits. It has fully exited its first six funds.

ChrysCapital now manages 12 funds—10 PE funds, one public markets fund and one continuation vehicle. A continuation vehicle enables the extension of a promising asset’s life.

Its latest fund, the $2.2 billion ChrysCapital X, is over 60% larger than the $1.35 billion Fund IX. The firm is deploying Fund X while exiting Fund VIII. Peers like Kedaara Capital have also stepped up their fundraising efforts, with a $1.73 billion Fund IV closed in 2024.

The latest fund saw a significant shift in the LP base. A little more than $1.7 billion came from global investors and about $300 million from domestic institutions and family offices. This represents a significant shift from previous funds, where domestic capital was “almost zero" and the strategy was “100% offshore."

Japan stood out. ChrysCapital added “six or seven LPs…close to $200 million," up from just one in the earlier fund.

“China has become a tough place to invest. People talked about this shift even in Fund IX, during covid, but then capital didn’t shift to India, it stayed in the US or Japan," Chatterjee said. “Now, global LPs are saying, if not China in Asia, then where? The flavour of the year for LPs has been India and Japan."

The firm also added Middle East family offices, a new France-based family office and a large US public pension fund. Many of these investors are taking their first exposure to India.