IVCA CAT III Summit 2025 Highlights India's Rapidly Expanding Alternative Asset Class, Focusing on Innovation, Expansion, and Outperformance
India's Alternative Investment Funds See Rapid Growth
Category III Alternative Investment Funds (AIFs) in India are experiencing a surge in growth, becoming a dominant segment in the alternative investment space. Over the past three years, these funds have recorded a compound annual growth rate (CAGR) of 65%, with capital commitments reaching approximately ₹2.3 lakh crore across 371 registered funds. Fiscal Year 2025 alone saw the launch of 95 new Category III AIFs, marking an 86% year-on-year surge in fund registrations.
This growth is reflected in the sector's capital commitments, which have significantly outpaced the broader AIF industry growth rate. Category III AIFs have captured more than 50% of all incremental capital flows into India's alternative investments recently, with a notable contribution from Non-Resident Indian (NRI) capital constituting about 54% of new inflows. This points to rising global interest in India’s long-short and absolute return strategies offered by these funds.
However, industry leaders have highlighted challenges that constrain the full potential of Category III AIFs. Regulatory caps on leverage limit strategy flexibility, ambiguities in tax treatment, and a lack of market depth and asset class diversity are some of the issues that need to be addressed.
The IVCA CAT III Summit 2025, held on August 6, 2025, in Mumbai, aims to address these opportunities and challenges by bringing together over 120 industry stakeholders for discussions on innovations, structural evolutions, and regulatory reform. The summit will feature voices from both the policy and investment community, including Shri Pradeep Ramakrishnan of the International Financial Services Centres Authority (IFSCA), Bhautik Ambani (AlphGrep Investment Management), Siddharth Bhaiya (Aequitas Investments), Prashant Jain (3P), Vikas Khemani (Carnelian Asset Advisors), Dr. Pritesh Majumdar (DSP Mutual Fund), Vikaas Sachdeva (IVCA CAT III Council Co-Chair), and Onkarpreet Singh Jutia (Nuvama Private), among others.
The summit is organized by the Indian Venture and Alternate Capital Association (IVCA), a not-for-profit, apex industry body promoting the alternate capital industry and fostering a vibrant investing ecosystem in India. The partners for the IVCA CAT III Summit 2025 include 3P, DSP, and Vivriti Asset Management, with Nuvama joining as the Custody and Clearing Partner.
The IVCA is committed to supporting the ecosystem by facilitating advocacy discussions with the government of India, policymakers, and regulators, resulting in the rise of entrepreneurial activity, innovation, and job creation in India and contributing towards the development of India as a leading fund management hub.
Priyam Kedia, Senior Portfolio Manager at Vivriti Asset Management, will introduce semi-liquid credit funds as a new asset class at the summit. Dr. Pritesh Majmudar, Head- Legal & Compliance and Compliance Officer, DSP Asset Managers Private Limited, stated that Indian equity markets have displayed sharp dispersion of returns within sectors, which can be captured by long/short equity funds. Udit Sureka, EVP and Head of Products at Nuvama Asset Services, believes that Category III AIFs are redefining the future of alpha in India's alternatives landscape.
In summary, Category III AIFs are India’s fastest-growing alternate asset class with strong momentum driven by innovative strategies and global investor interest. The IVCA CAT III Summit 2025 will provide a timely platform for industry leaders to decode key trends, navigate regulatory developments, and craft a forward-looking roadmap for the ecosystem.
- Innovative strategies and global investor interest are driving the rapid growth of India's Category III Alternative Investment Funds (AIFs), which have recorded a significant increase in capital commitments and new fund registrations.
- To address the opportunities and challenges in the sector, the IVCA CAT III Summit 2025 gathered industry stakeholders to discuss innovations, structural evolutions, and regulatory reforms, aiming to contribute towards developing India as a leading fund management hub.
- Category III AIFs are playing a crucial role in shaping the future of India's alternative investments, with the introduction of new asset classes like semi-liquid credit funds and the potential to redefine alpha in the market. However, it is essential to address regulatory constraints, ambiguities in tax treatment, and a lack of market depth and asset class diversity to achieve the full potential of these funds.
