Gaja listing could give AIF managers more firepower to invest: UK Sinha

Gaja Alternative Asset Management, a ₹550-crore IPO company, debuted on the market on Wednesday at a premium of approximately 16 per cent to its issue price of ₹160. The IPO was subscribed 31.33 times. In an interview with businessline, UK Sinha, the non-executive chairman of Gaja Alternative Asset Management and a former SEBI chairman, discussed the impact of Gaja's listing on alternative asset managers (AIFs).

The listing provides AIF managers with additional firepower to invest, mainly through sponsor commitments to existing and proposed funds and repayment of a bridge loan. SEBI regulations require AIFs to invest at least 2.5 per cent of the size of their funds to have skin in the game. Gaja's listing enables them to make a sponsor contribution, removing the growth constraint.

Sinha believes that the listing will encourage more AIFs to get listed, providing them with additional support or firepower to invest in the innovation economy. He also emphasized that the listing will institutionalize alternatives AIFs, allowing them to raise institutional capital and make more investments in innovation through their AIF funds. This boost will significantly benefit the startup ecosystem.