True North raises ₹1,000 crore towards maiden credit fund

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₹1,000 crore towards its maiden credit fund, marking its entry into private credit. True North, with assets under management of over $3 billion, raised capital from Indian ultra-high net worth individuals (UHNIs) and family offices. It will look to deploy the capital over the next five years and is targeting a 15-18% internal rate of return (IRR), Vishal Nevatia, founder and managing partner, True North and Kapil Singhal, managing partner at True North’s private credit unit said.

The firm expects to close the credit fund with around ₹1,300-1,400 crore of capital by December. True North has so far raised six private equity funds and has looked at a second asset class to complement its private equity business over the last five years. It has closed its sixth private equity fund at $600 million in 2020.

It has so far invested in more than 70 businesses through its private equity unit, over the last 24 years across consumer, financial services, healthcare, and technology sectors and made around 50 exits, generating a cumulative return of around 23-24% IRR in local currency. Venture capital, real estate, distressed assets and growth stage PE were the areas considered before deciding that credit would be the best natural extension for the firm. “We felt that credit would be a very attractive and a large opportunity in India over the next 10-20 years.

It has gone through an early period of stress and eventually come through -- we think private credit is where private equity was 15 years ago," Nevatia said. Singhal joined True North in late 2021 to set up the company's credit team, which now has eight investment professionals and analysts. Through its credit fund, True North will look to bridge the supply-demand gaps for