Neo eyes ₹5,000 cr fund as market slump lifts credit play

The fund will target firms with strong cash flows and collateral, focusing on pharma, hotels, paper and steel

- Srushti Vaidya

Neo Asset Management seeks to raise ₹5,000 crore for a new private credit fund, sensing a bigger opportunity as the public listing market slows amid a stock market slump. The Neo Special Credit Opportunities Fund II, launched three months ago, has secured ₹2,000 crore from family offices, ultra-high-net-worth individuals, and institutional investors like insurance companies, said Hemant Daga, co-founder and chief executive of Neo Asset Management, in an interview.

The opportunity for private credit is getting better because equity as a competing pool will shrink for the next six to nine months, said Daga, citing the ongoing correction. "Over the last two years, the need for capital in special situations—like bridge financing—has been consistent. It's an evergreen opportunity. But with equity capital becoming less accessible in the current market, our opportunity set has expanded."