Performance Benchmarking of AIFs


The Securities and Exchange Board of India (SEBI) after deliberations on the recommendations of Alternative Investment Policy Advisory Committee (AIPAC) and Indian Private Equity and Venture Capital Association (IVCA) on the aspect of Performance Benchmarking for the Alternative Investments Industry, issued a circular on this matter.

The Alternative Investment Policy Advisory Committee (AIPAC) which was set up under the able leadership of Shri Narayana Murthy submitted its 2ndAIPAC committee report to the SEBI and the Ministry of Finance on 1st November 2016. This report deals in detail the need for performance benchmarking for AIFs in a country like India. Post the subsequent discussion & deliberations and tremendous contribution from the members the AIPAC committee as well as the working group members for benchmarking of AIFs under the aegis of SEBI, it has been possible to come to a stage where SEBI has put out a definitive circular on the applicability of the same. There was a greater call among the Industry to have more transparency in the Alternative Investment Funds universe which will greatly help instil confidence in the Investors and develop mutual trust. We have seen the Industry grow from Rs 0.31 lakh Cr. (USD 4.38 Bn) as of 31st Dec 2015 to Rs 4.51 lakh Cr. (USD 62.66 Bn) as of 31st March, 2021 in terms of the commitments raised. Kindly note that the numbers refer to only the SEBI registered AIFs portion of commitments raised and excludes all non AIF/Global funds operating in India. To achieve the objective of attracting large pools of long-term funds, the industry needs to equip itself in order to cater to the needs of the diverse set of investors it attracts. To fulfil this objective, three critical factors were identified:
  1. disclosure of relevant fund-level information to its investors;
  2. enhanced fund-level governance and
  3. aggregate data on industry-level performance to inform and thereby attract current and potential investors
Keeping the above in mind, the Securities and Exchange Board of India (SEBI) issued a circular SEBI/HO/IMD/DF6/CIR/P/2020/24 dated 5th February 2020 on Disclosure standards of AIFs and read along with SEBI circular SEBI/HO/IMD/DF6/CIR/P/2020/99 dated 12 June 2020, wherein under it notified implementation of performance benchmarking for Alternative Investment Funds (AIFs) with effect from 1st October, 2020 and is mandatory for all AIFs.

IVCA fulfils the criteria as mentioned in the circular and this is to inform you that SEBI has taken on record IVCA’s eligibility to appoint one or more benchmarking agencies to conduct performance benchmarking for Alternative Investment Funds (AIFs).

To give brief backdrop, IVCA is the oldest and not for profit industry body in India having the highest representation of the PE & VC firms. It was established by industry professionals with a unified aim to drive forward India Private Equity (PE) & Venture Capital (VC) industry. Its purpose is to promote and support the Alternative Investment Asset class by facilitating advocacy discussion with the Government of India, policymakers, regulators, and supports the entrepreneurial activity, innovation and job creation in India.

Read more about IVCA:

A) Appointment of Benchmarking Agencies

  • Pursuant to the circulars and IVCA’s eligibility to appoint one or more benchmarking agencies, IVCA has initially appointed CRISIL Limited, a premiere rating agency in India and recently appointed Preqin Limited, a premiere data service provider and benchmarking agency for alternatives industry globally as the benchmarking agencies for conducting benchmarking of AIFsand NSE Indices Limited (100% subsidiary. And not 0.00 % of National Stock Exchange of India Ltd.), one of the foremost indices company in India. They provide a variety of indices and index related services for the capital markets. The company owns and manages a portfolio of indices under the NIFTY brand of NSE, including the flagship index, the NIFTY 50.

B) Benchmarking Timeline

  • The first Industry benchmarks for CAT I, II & III respectively, have been launched by CRISIL on 1st October 2020. The link to CRISIL Industry Benchmarks is given at the top of this page.
  • While CRISIL for the current benchmarks put out, has focused on the benchmarks for each of the three categories on an aggregate basis and a few vintages from 2014 onwards where there is a minimum number of registered AIFs, it intends to create and launch benchmarks for various sub categories in Phase 2 of the project.
  • Preqin & NSE Indices has recently been appointed as benchmarking agencies and just initiated data collation process and is estimated to take 5-6 months to launch the benchmarks
  • The benchmarking agenciesare expected to declare Performance Benchmarks on a bi-annual basis on the data as of September 30th & March 31st every year.

C) Reports

  • Every AIF which intends to raise funds in the country can obtain Performance Benchmarking Report from any of the three agencies at their option, the details of which can be included in its PPM and other marketing material.
  • In addition to the above, AIFs which are not raising any funds, but still wish to get a report from these agencies on performance of their schemes/ funds, they may also get a report.
  • The commercial considerations involved in procuring such benchmarking reports and usage of benchmarks shall be obtaineddirectly from the respective agencies

D) Data Collection and NDA

  • The process of data collection is applicable for all AIFs/ Schemes of AIFs that are registered with SEBI, which shall be required to provide all the necessary information/data to these agencies as may be sought by it.

To this effect the AIF &the agency shall enter into a non-disclosure agreement. A standardized template has been finalized by each of the agency respectively for the sharing of data by AIFs for the purpose of benchmarking and will be communicated by the agency to AIFs by email. Please note IVCA does neither takes any responsibility nor involved in the process of data collection by the agencies and the confidentiality of the date.

  • SEBI Circular dated 5 February 2020 – CLICK HERE
  • SEBI Circular dated 12 June 2020 – CLICK HERE
  • Operational Guidelines for implementation of Performance Benchmarking – CLICK HERE

For any queries you can directly reach out:

CRISIL Limited at:

Preqin Ltd. at

NSE Indices Ltd. at

We would like to thank SEBI who have been extremely reasonable and fair on many issues and have been open to suggestions and provided us with a support and guidance throughout the entire exercise.

We request all AIFs to be open, positive and accept this requirement and co-operate with IVCA,and the benchmarking agencies in this process. We look forward to your cooperation and working together towards achieving the performance benchmarking standards for India.

DISCLAIMER: IVCA is acting under the eligibility criteria fulfilled under the SEBI Circulars and is only facilitating the development and implementation of the benchmarking indices for the AIFs and other related services as prescribed by SEBI in its circulars for AIFs. As a not-for-profit industry association IVCA has used its best efforts to facilitate implementation of the performance benchmarking as per the SEBI directive, it disclaims any and all liability to any person in this regard and any person availing the services of any benchmarking agency so nominated shall be doing so at either at their discretion or under the directive of SEBI and shall not hold IVCA in any manner responsible or liable. IVCA makes no express or implied warranties or representations as to any aspect of the data security, performance of benchmarking services by the benchmarking agency(ies) so nominated by it.