Old Bridge Capital Management is launching its first open ended category 3 alternative investment fund (AIF) that will invest in publicly listed companies, said a senior executive of the firm. The latest fund, unlike the past products which were close ended, will make investments easier for long-term investors.
Category 3 AIFs invest in public markets, while Categories 1 and 2 cater to venture capital, private equity and debt and infrastructure funds.
Old Bridge was founded in 2015 by Kenneth Andrade, who was chief investment officer at IDFC Asset Management Co. Andrade has over 25 years of experience in Indian capital markets. At IDFC, he was responsible for the performance of a corpus of $8 billion.
Apart from its latest AIF, the firm currently also runs a portfolio management service (PMS) and two closed ended AIFs, Vantage Equity Fund and a fund dedicated to non-resident Indian (NRI) investors. Across all its product offerings, Old Bridge today manages around ₹2,600 crore in assets under management.
According to Andrade, with the latest open ended fund, the firm is moving towards a strategy where it will have products in line with what mutual funds offer.
“It (the latest fund offering) is more of an open-ended product that allows us to take subscriptions on a regular basis and there will be weekly exits. We have made it a little more convenient for longer term investors and we have improved the liquidity of the product for them. Long term investors can participate in this product over a period of time subject to a limit of 1,000 investors. So it is a product in perpetuity now," said Andrade.
The latest Old Bridge fund will seek investments from domestic investors as well as NRIs and foreign portfolio investors (FPIs), except for investors from Canada and the US, he added.
Old Bridge’s latest offering for investors will build upon the existing strategy that the firm deploys across all its existing products.
“Across all the products - PMS, the Vantage Equity Fund and our long term equity fund - the underlying portfolios will be almost the same. They will have an approximately 80% overlap," said Andrade.
The firm’s investments are largely concentrated on the industrial economy in India and in businesses such as agri-inputs and mechanization of the farm.
“Close to about 60% of our portfolio is in industrial and the farm economy. The next decade that will come through, we think that the balance sheet focus - both of the government as well as the banking system - which is reasonably consumer, retail centric will shift focus. We have put a reasonable amount of capital to work in the place where banks are under invested from the lending side," said Andrade, adding that he also finds valuations in these spaces quite attractive.