Fund Advisory

2 Feb 2015

2 Feb 2015

By:

Overview

Fund Description The Fund intends to invest in real estate development entities / projects across 6 pre-identified Indian cities
Fund Structure Fund is set up under the Category -2 AIF with a trust structure
Target Fund Size INR 5 bn
Term 4 years, from final closing date, subject to two extensions of 1 year each
Investment Manager Nisus Finance Services Co Pvt. Ltd.
Minimum Investment INR 10 m from all investors to be drawn down over 18 months

Investment Strategy

Focus Cities

  • The fund intends to invest in residential projects in Pune, Delhi/ NCR, Mumbai, Bangalore, Chennai & Kolkata
  • Focus on mid-market residential space– leverage rapid urbanization, rising income, young population, improving infrastructure– driving housing demand


Superior risk adjusted return

  • Structured Investments  via largely-rated & possibly-listed NCDs backed by adequate security package
  • Focus on monthly equated returns through high interest income deals
  • To focus primarily on Brown field residential projects with coupons of between 18 to 20%, payable monthly or quarterly
  • Opportunistically down sell a part of deals  in order to earn interest spread, boosting IRR over 25%


Duration

  • Target investments of average of 18 months with in-built exit strategies


Risk Mitigation

  • Fund will make Senior Secured Investments, mostly with a first charge on assets
  • Investment in partially or nearly completed, fully approved and active projects – no regulatory/ statutory risks
  • Asset Security coverage of at least 2X & Cash flow coverage on Principal amount of at least 2X
  • Not more than 20% of corpus in any 1 portfolio company & such other restrictions as prescribed
  • No Investment in any entity owned by any of the sponsors

 STRUctured Buy Back (STRUBB)

STRUBBSTRUctured real estate investment opportunities in advanced stage, grade A residential projects with assured Buy Back and fetching high return on investment (ROI) with risks mitigated.

Synopsis

  • Bulk investment @ deep discount from the current market price in Grade A residential projects
  • Filter Criteria
    • Developer Category A/B+
    • Strong past record
    • Major approvals obtained
    • Advanced stage of construction
    • Vendor deliverability
  • Robust due diligence (technical, legal, financial) process
  • Regular checks for monitoring construction progress , maintaining sale velocity threshold,
  • Developer to buy back the inventory at intermittent intervals within 2 years with an extension of 1 year
  • Advantages
    • Payment schedule benefits
  • Reduced upfront payment
  • Deferred payment
    • Short tenure
    • Sales assurance

Nisus offers a bouquet of funds that cater to the diverse needs of both its institutional and individual investors.

Our mission is to manage risk effectively while generating top quartile returns across all product categories. We believe in cultivating investor loyalty and are focused on helping our investors realize their investment goals, through prudent advice, judicious fund management, impeccable research, and strong systems of managing risk scientifically.

Nisus High Yield Debt Fund

We Focus on mid-market residential projects across top 6 commercial cities and generate fixed periodic returns by investing in brownfield approved projects. At NiFCO we prefer for projects with atleast 10% of the construction completed and 20%-50% of the stock already sold. Read More