India’s Kotak Alternate Asset Managers is aiming to raise up to $2bn for its third private credit fund, underscoring rising investor interest in the sector despite turbulence in global markets, according to a report by Bloomberg.
The firm plans a final close by September, with Managing Director Srini Sriniwasan highlighting opportunities across data centres, pharmaceuticals, diagnostics, steel, and cement.
Unlike US private credit markets, where recent high-profile setbacks have forced firms such as Morgan Stanley and Cliffwater to cap redemptions, India’s market is largely closed-ended, reducing the risk of sudden outflows. Sriniwasan noted, however, that currency volatility remains a concern for overseas investors, as the rupee recently hit record lows against the dollar amid rising energy costs.
The market has expanded rapidly, growing 35% to $12.4bn in 2025, according to EY, buoyed by large transactions such as Shapoorji Pallonji Group’s $3.4bn private credit deal last year. Kotak’s new Strategic Situations Fund will primarily invest in debt, with potential conversion to equity, and will be raised via its GIFT City unit, India’s international financial hub.
Kotak has previously launched two private credit funds — the $1bn Kotak Special Situations Fund and the $1.5bn Kotak Strategic Situations Fund — backing firms including Sify Technologies, AGS Transact Technologies, and Nuvoco Vistas Corp. The firm also manages a $664m infrastructure vehicle.
