Private equity firm TVS Capital Funds has closed its fourth and biggest rupee capital fund till date of ₹3,535 crore on the back of robust participation from institutional investors. Along with co-investments, the firm looks to make over ₹4,500 crore of investments from the fourth fund.

‘Coming of age’

“We believe this is perhaps the largest long only rupee capital third party fund,” Gopal Srinivasan, chairman and MD, TVS Capital, said. “The Fund IV closing has indicated the coming of age of institutional capital,” he adds. TVS Capital raised over ₹1,000 crore in institutional capital for this fund compared to just about ₹300 crore last time and cheque sizes from institutions too have gone up, he noted.

Family offices contributed around 38 per cent of TVS Capital’s Fund IV. Institutions make up 28 per cent and HNIs 24 per cent, and balance 10 per cent from its sponsors. Among institutions, the PE firm has seen outsized interest from insurance sector for this fund. Some banks are also part of the capital pool.

As a growth investor, the firm expects to write cheques of around ₹400-450 crore. While the investment thesis remains similar, the PE firm says it has started to put in place a structure of operating partners to invest more in firms where they can take minor controlling stakes and work with founders to grow operations. IT and digital services firms is an area we will look to focus from the fourth fund, Srinivasan said. The PE firm’s previous Fund III was about ₹1,400 crore in size.

Go Digit, Insurance Dekho, Yubi, Vivriti Capital, and Leap Solutions are among a few portfolio companies of TVS Capital.

Srinivasan is optimistic about a boost in co-investment by family offices and HNIs given SEBI’s new framework allowing Category I and II Alternative Investment Funds (AIFs) to offer co-investment opportunities directly within the AIF structure. “We anticipate a 10-20 per cent rise in co-investments with this relaxation, Srinivasan said.

Noting that the AIF sector has seen multiple positive regulatory changes, Srinivasan says that there is more collaboration today between the industry and regulatory bodies. “Pensions can be the next big wave for private equity firms and we hope to work with the regulators to realise this,” he adds.

Published on June 20, 2025