The Indian financial system has undergone a marked shift as of January 2026. The phase of “Passive Alpha” offered by broad-based mutual funds is nearing completion, as more than 51% of active mutual funds in the large-cap category have failed to outperform their benchmarks in the previous fiscal year. Amidst his high-pressure situation, the focus is now on premium mutual fund players as well as Alternative Investment Funds (AIFs), as these players are currently acting as key drivers to produce consistent alpha in order to beat the High-Net-Worth Individuals (HNI) benchmarks.
As of December 2025, the AIF (Alternative Investment Funds) sector has achieved a historic milestone, with total investment commitments exceeding ₹15.05 lakh crores, or $175 billion. It represents a quantum leap and a paradigm shift for the country’s sharpest minds.
Decades ago, the “60/40 split of equity and bonds” was considered the benchmark of elite Indian investing. However, in light of 2026, there is a need to be more aggressive with their “Alpha Engine.” Top investment houses are currently advising that a ‘core-satellite approach’ with less public equity and more alternatives would be ideal.
Table: The Great Rebalancing (Typical Elite HNI Portfolio)
| Asset Class | 2021 Allocation (%) | 2026 Allocation (%) |
| Public Equities (Mutual Funds/Direct) | 60% | 35% |
| Alternative Investments (AIF) | 7% | 25% |
| Real Estate (REITs/InvITs) | 15% | 20% |
| Private Credit / Structured Debt | 3% | 10% |
| Cash/Fixed Income (FD/Bonds) | 15% | 10% |
It highlights a clear shift in elite HNI portfolios away from traditional public equities toward alternatives, real assets, and private credit, driven by the search for higher risk-adjusted, inflation-protected returns.
Source: SEBI AIF Industry Statistics (FY21–FY25); Bain & Company – India Wealth Report 2024; BCG: Global Wealth Report 2024. 2026 allocations are indicative estimates based on industry reports[2].
This implies a more than 2.5x increase in the share of alternatives in the average HNI portfolio over five years. The reason is this straightforward philosophy: Uncorrelated Alpha, returns that do not correlate with the Nifty 50.
Alpha AMC: Unravelling the Powerhouse SME & Pre-IPO
Though the industry is big, a select few fund houses have created a differential for themselves by specialising in the “Hidden Gems” of the Indian economy. Alpha AMC has emerged at the forefront in this space, more specifically through its flagship VentureX AIF, which is a Category I fund designed to capture the structural growth of India’s Small and Medium Enterprises.
The Leadership-institutional pedigree is combined with technological precision.
The high and consistent alpha created by Alpha AMC is a function of a leadership team that bridges the gap in old-school value investing and modern forensic technology.
Maneesh Nath (Fund Manager): Global data support his reputation as a “multibagger hunter.” He formerly managed the Passage to India Opportunity Fund, ranked No. 1 by Preqin as the top fund manager globally in its category, outperforming over 50,000 international funds. His track record of identifying returners like Jyoti Resins and Astral at 50x–100x is the bedrock for the firm’s conviction.
Rajesh Singla (Founder and CEO): A technocrat with an illustrious background at Amazon and Accenture, Rajesh introduced the discipline of evidence-based decision-making in the unlisted sector. With his vision at Planify (predecessor company of Alpha AMC), he and his team enabled more than 31 successful exits, converting an investment of ₹3.1 crores into ₹17 crores with an earth-shaking CAGR of 117.61% over a span of 6 years from 2019 till early 2025.
Ishima Singla (Co-Founder & CIO): Brings focus on institutional governance from her experience of a decade at EY and imparts a “Scuttlebutt” & “Forensic First” approach to filter out corporate governance risks that often affect small-cap and SME stocks.
The LMVT Framework: A Scientific Approach to Alpha
These are elite fund houses that do not use market sentiments; instead, they use their own models. Alpha AMC’s Model for Valuing and Trading, or LMVT for short, is developed to take into account the high-risk, high-reward nature of the SME segment and is given
Liquidity (L): Investment in companies with an easy IPO or secondary offering in 3 to 5 years.
Management (M): 50-point forensic check: integrity of promoters, skin in the game (>60%), related-party transactions.
Valuation (V): Entry at minimum 30% below peer companies quoted in public markets.
Technology/Trend (T): Emphasis on areas like Manufacturing, Nuclear, Solar Energy, Chemicals, and Defence, where there are structural tilts.
Data in Action: The SME Advantage
The performance gap between the broad market and specialised SME portfolios has reached an all-time high in 2026. While the Nifty 50 TRI provided steady single-digit returns during market consolidations, the SME segment (represented by the NSE Emerge platform) has become the new frontier for alpha.
Case Study: Sectoral Alpha in the VentureX Portfolio (Nov 2025 Factsheet)
Alpha AMC’s VentureX Fund I, with ₹213.51 crore in total commitments, demonstrates why sectoral focus matters. Their portfolio remained resilient during the 2025 volatility by overweighting specific high-growth areas:
- Chemicals:61% allocation
- Solar/Renewables:96% allocation
- Logistics:01% allocation
By staying clear of “over-owned” large-cap sectors, the fund targets the 10x–20x compounding phase of a company’s lifecycle, the stage before institutional investors and the general public bid up valuations.
- The Pre-IPO Pricing Arbitrage
In the present cycle, a large number of top-notch manufacturing and tech firms are deciding to go private for a longer period of time. By the time the firm makes its debut listing on the Mainboard IPO itself, the major portion of the growth potential is already harvested. Elite AIFs give HNIs the ability to join the pool when the firm is in the ‘Preferred Pricing’ phase, that is, when it’s 2 to 3 years before the initial public offering.
Regulatory Maturity & Pass-Through Taxation SEBI’s regulatory changes in 2025-26 have ensured that the transparency level of AIFs is at its peak. Category I and Category II AIFs are given tax pass-through treatment. This means that the AIF is not taxed. The taxes are directly charged to the investor. This helps a lot in tax planning. It is beneficial to the NRI investors. They can take advantage of the Double Taxation Avoidance Agreement.
- Institutionalising the “Club Deal”
Historically, the best deals in India were “club deals” available only to a handful of ultra-wealthy families in Mumbai or Delhi. Funds like VentureX have institutionalised this access. With a minimum commitment of ₹1 crore, a broader pool of HNIs can access the same due diligence and deal flow once reserved for the billionaire class.
Performance Benchmarking: Retrospective 2025, for anyone to understand why elite fund managers are in demand, they have to see the performance dispersion of 2025. While the Nifty 50 slipped over 2.7% in July 2025, for instance, the best long-short AIFs returned an average of -0.29%, with market-neutral strategies like AlphaGrep’s AlphaMine and Nuvama’s Multi-Asset Strategy actually clocking in positive returns of 1.2-1.4%.
This ability to protect capital during drawdowns while capturing the “explosive alpha” of the SME upswing is what separates an elite fund house from a standard asset manager.
Conclusion: The Horizon of 2030
The “Alpha Gap” will only continue to increase as India’s GDP hurtles toward the $7 trillion mark by 2030. Fast economic formalisation is quickly building organised SMEs into corporate leaders. For the new HNI, it is no longer about “beating the index”; it is about choosing the right fund manager who has the forensic tools and institutional pedigree to identify the next Astral or Jyoti Resins before they become household names.
With 102% CAGR track record and a globally top-ranked fund manager at its helm, Alpha AMC represents the new standard in Indian asset management-a blend of high-conviction SME investing and institutional-grade risk management.
