Cat-II vs Cat-III AIFs – A Regulatory & Practical Comparison for Large Value Funds
CAT-II vs CAT-III AIFs S. No. Criteria Category II AIF Category III AIF 1 Investment Limit Accredited investors can invest up to 50% of investable funds in an investee company. Limit is 20% of investable funds in an investee company. 2 Tenure Close-ended, minimum 3 years. Open-ended or close-ended. 3 Investment Focus Primarily unlisted securities and/or listed debt rated ‘A’ or below. Listed/unlisted securities, derivatives, other AIFs, structured products, commodities, CDS. 4 Leverage Not permitted. Permitted up to 2x NAV through derivatives/borrowing. 5 Valuation Independent valuer once a year. NAV disclosure quarterly (close-ended) / monthly (open-ended). ...