ArthVeda Fund Management Pvt Ltd (AVFM), today, announced the launch of ASHA Fund, a Rs. 2,000 crore affordable housing Fund for Low Income Households. The Fund will participate with multiple developers across India (including Tier 2 / 3 cities) in the construction of affordable housing for Low Income Households.
ArthVeda’s announcement follows the launch of 3 flagship schemes of Central Government for creating affordable housing stock and developing urban infrastructure. “ASHA Fund has been in the making for some time after the success of our affordable housing fund for Middle Income Households, STAR Fund. It is a matter of satisfaction to us that the launch of ASHA Fund coincides with announcement of the Pradhan Mantri Awas Yojna (PMAY). ArthVeda is proud to join in the efforts of PMAY in creating affordable housing stock.” said Mr. Bikram Sen, CEO of ArthVeda.
ArthVeda is an Asset Management Company (AMC) specializing in investments in Low / Middle Housing. The AMC has demonstrated a successful strategy of investing in Middle Income Housing (MIH) through its previous fund, STAR Fund. STAR Fund exclusively invests in MIH projects and is achieving IRRs of 30%+. STAR Fund has now been scaled up and opened to foreign investors with the launch of STAR Fund II with a targeted AUM of Rs. 1,500 crores. ArthVeda is now launching ASHA Fund to take its proven investment strategy of investing in quick turnaround MIH projects to Low Income Housing (LIH).
ArthVeda is part of a leading financial services group, of which the flagship is Dewan Housing Finance Corporation Ltd (DHFL), the 2nd largest private mortgage finance company in India. “ArthVeda leverages our knowledge and leadership in the Low & Middle Income Households (LMI) space to investments in affordable housing. DHFL has a 30 year history of providing mortgage and project finance to LMI. We have a pan India presence including Tier 2 and Tier 3 cities. In 2010, we formed a JV with IFC (Washington) to create Aadhar Housing Finance Ltd (AHFL), a mortgage finance company exclusively for Low Income Households. The launch of ASHA Fund and STAR Fund II will make ArthVeda the most prominent private equity player in the LMI housing segment.” said Mr. Kapil Wadhawan, Chairman and Managing Director of DHFL, AHFL and ArthVeda.
“Aadhar’s field force and expertise in lending to Low Income Households together with ArthVeda’s expertise in managing investments in affordable housing is a unique combination and creates a powerful channel to bring private equity into affordable housing. Initiatives like ASHA are in dire need since the official figures of 2 crores affordable housing shortage is only understating the problem on the ground.” said Mr. Deo Shankar Tripathi, CEO of Aadhar.
Mr. Sen, further said,”ArthVeda is, perhaps, the only AMC that can successfully execute such strategies because of its Group strengths. ASHA Fund will be done in conjunction with DHFL and AHFL, through which ArthVeda has access to a ground force of more than 5,000+ personnel and relationship with 300 builders across 736 locations in India.” Expertise of the Group companies in the LMI segment and a vast ground force enables ArthVeda to significantly reduce investment risks. The Group, collectively, lends USD 350 mil across India every month. ArthVeda, along with its Group Companies, provides “financial closure” to Low & Middle Income Housing projects.
ASHA Fund has also built in a unique feature apart from creating affordable housing stock. ArthVeda is working with various NGOs, Social Impact Investors and CSRs to design markets based solutions for strengthening the Low Income Households. Given that creation of affordable housing is a national priority now, ArthVeda is confident that SEBI will accede to its request to change the current status of ASHA Fund from AIF CAT II to AIF CAT I.