Gaja ALT Asset MGT Q1 FY27 earnings call

What moved the numbers, as management explained it

• Total expenses grew only 14% YoY to INR19.9 cr vs 26% income growth, driving cost-to-income from 42.3% to 38.4% and lifting operating leverage.
• Performance income rose 17% YoY, lifted by market recovery from March 2026 lows improving fair value gains on sponsor commitments in Funds III and IV (INR17 cr of INR29.7 cr Q1 performance income).
• Q4 FY26 performance income was depressed by multiple re-ratings at March 2026 lows, creating an apparent Q1 step-up; LTM performance income INR92.2 cr is the steadier read. (one-off)
• IPO proceeds of INR575 cr (33x oversubscribed) lifted net worth to INR633.6 cr from INR534 cr, partly offsetting ROE drag and supporting book value per share rise of 19% to INR56.1. (accounting)
• Fee income grew only 7% YoY because management fees are charged on initial committed capital, not NAV, capping fee growth versus performance income.

Guidance on this call

By business

Balance sheet, capex and funding

• Net worth INR633.6 cr as of June 30, 2026 vs INR534 cr PY; post-IPO group net worth INR1,050 cr.
• ROE improved to 15.3% from 14.7%; book value per share INR56.1 vs INR47.3 (+19%).
• IPO raised INR575 cr primary capital at 33x oversubscription; team retains 68%+ ownership.
• Sponsor commitment INR589 cr across funds, representing 7.1% of total fund size.
• Total expenses Q1 FY27 INR19.9 cr vs INR17.4 cr Q1 FY26 and INR18 cr Q4 FY26; cost-to-income 38.4%.
• No debt or capex commentary on this call; Price Waterhouse appointed statutory auditor going forward.

The industry, as management sees it

Management sees Indian alternatives industry as structurally high-growth — AIF AUM has grown 6x in recent past vs mutual fund AUM at 3.3x and bank deposits at 2.1x, and is expected to grow another 6x to ~USD1 trillion over the next decade. They view Gaja as the first listed pipe connecting India's savings system to alternatives, with the retail-investor access gap (very few can invest in AIFs directly) as a structural growth lever.

Risks management named

• Lumpiness in quarterly performance income (carry + sponsor gains)
• Fund III currently at modest ~9% gross IRR raises questions on future carry realisation
• Forward guidance explicitly withheld per board advice
• Quarterly fair value gains exposed to broader market volatility
• No defined timeline provided for Fund II/III/IV wind-up or Fund V/Eastgate first close

Not answered directly

• Future fund timelines (Fund II/III/IV wind-up, Fund V/Eastgate first close)
• Forward guidance on expenses and growth rates
• Long-term platform diversification roadmap beyond current strategies
• Fund III carried interest realisation timing

Asked for a number, answered without one

• Forward guidance on carry and performance fees: Declined, citing board advice and industry best practice; said they will not issue future guidance and will rely on historical trendlines.
• Fund II/III/IV wind-up timelines and Fund V / Eastgate first close dates: Declined, classifying answers as future guidance which the board and advisors had asked them not to issue.
• Total portfolio valuation including LP share: Said SEBI mandates quarterly valuations to LPs but no single portfolio figure exists; valuations follow SEBI guidelines.
• Fund III carried interest timing: Confirmed Fund III is already generating sponsor gain income; carried interest deferred until hurdle is returned; no timing given.

Every question, with its answer

1. 1. Fund IV deployment pace

   Siddhant Lodaya, Sanshi Fund

   Question. Congratulations on listing. What is the dry powder in Fund IV and how many potential investments are you targeting from that?

   Answer, Gopal Jain, Managing Director and CEO. Typically from a fund we invest in 10 to 12 companies. In Fund IV, until June 2026 we had made seven investments. We were 75% deployed as on June; since then deployment has gone to 81%. Going forward, we will make 10 to 12 investments from Fund V as well.

2. 2. Performance fee mix and predictability

   Mithun Aswath, Kivah Advisors32:28

   Question. What would be the proportion of carried interest or performance fee as a percentage of total income generally constitute and how is that trend likely to move? Is there an effort to make pure fee income a larger share?

   Answer, Gopal Jain, Managing Director and CEO. It's actually the opposite. Performance income grows over a period of time and becomes highly predictable. For Q1, out of total income of ₹51.8 cr, roughly ₹16 cr is management fee income and roughly ₹30 cr is performance income. Since we raise money only once in a while and management fee doesn't grow in line with NAV, the key growth vector is performance income. On LTM basis the trend is steady. Sizes of new funds: Fund V ₹2,500 cr (may increase), Eastgate ₹1,500 cr.

3. 3. Carried interest sources and hurdles

   Soumil Zaveri, DMZ Partners36:23

   Question. Would my understanding be correct that the bulk of the carried interest is still contributed from Fund II? Given Fund III gross IRRs are around 9%, should we temper expectations of carried interest from Fund III? And are hurdle rates typically 10%?

   Answer, Gopal Jain, Managing Director and CEO. Yes, carried interest comes from Fund II. The sponsor gain line comes from Fund III and Fund IV. On Fund III it's too early to say — valuations have been carried on a conservative basis and we believe we'll continue performance income trends from Fund III. For rupee investors hurdle is 10%; for dollar investors 8%.

   Partly answered.

4. 4. AI investment thesis and platform strategy

   Abhi Jain, AJ Capital

   Question. Given concerns about AI cycle stage, what is your view on entry valuations in AI investments like Fractal and Sarvam? And longer-term, how do you see Gaja evolving across different alternatives like real estate, REITs, buyout funds?

   Answer, Gopal Jain, Managing Director and CEO. AI is a five-layer cake; both Fractal and Sarvam are relatively mature growth-stage opportunities and we have refrained from venture-stage. We do not put more than 20-25% of capital into any one sector. Fund IV is currently running at 29% gross IRR. On platform evolution: globally, firms earn the right to diversify after 20 years. In the foreseeable future our platform will grow in a disciplined, measured way around our mid-market competence — no speculative forward statements.

   Partly answered.

5. 5. Carry lumpiness and quarterly volatility

   Jyothish Vijayan, Moat Financial Services

   Question. Q1 carry fee jumped 594% versus Q4 FY26 — is this because of realizations in this quarter, which is common in this business? Given the RHP mentions carry is mostly lumpy, how should investors judge performance quarter-to-quarter?

   Answer, Abhinav Jain, Chief Financial Officer. Performance income has two parts: carried interest and sponsor gains. Q4 FY26 was impacted by multiple re-ratings when markets were at lows; June quarter reflects recovery. LTM shows the smoother picture. Performance should be judged on a year-on-year basis; quarter variations will be minimized as funds diversify.

6. 6. Performance fee breakdown, expenses, and fund timelines

   Devesh Agarwal, IIFL Capital54:41

   Question. Can you break out performance fee income into carry and sponsor? On the management fee, what is the related committed capital? And on expenses, should we expect variation between employee cost and overheads quarter-to-quarter, and what are timelines for winding up Fund II/III/IV and first close for Fund V/Eastgate?

   Answer, Gopal Jain, Managing Director and CEO. In Q1 FY27, ₹13 cr came from Fund II (carried interest) and ₹17 cr came from Fund III/IV (sponsor gains), totalling ₹29.7 cr performance income. LTM performance income was ₹92.2 cr (₹72 cr + ₹20 cr). We do not book carry on accrual — only on realised basis. Management fee is earned on initial committed capital of roughly ₹3,200 cr (from Fund III and Fund IV). On expenses: Q1 FY27 was ₹19.9 cr vs ₹17.4 cr same quarter last year and ₹18 cr in the prior quarter — disciplined and steady; cost-to-income came down from 42% to 38%. Q1 has seasonality from bonuses — compare Q1 of this year to Q1 of last year (both ~₹10+ cr employee cost). On fund timelines and first close for Fund V/Eastgate, we cannot issue future guidance per board advice.

   Not answered directly.

7. 7. Portfolio valuation frequency and methodology

   Atharva Bagli, Catalyst Partners56:00

   Question. When was your portfolio last valued, and what is the total valuation including LP share?

   Answer, Gopal Jain, Managing Director and CEO. As a regulated industry in India, portfolio valuations must be done every quarter. We follow SEBI guidelines and issue valuations to LPs every quarter — the same valuations are used to determine our own holdings. There is no one single portfolio — there are multiple funds, each with its own distinct investor base. We have given a table with gross MOIC for each fund.

   Partly answered.

8. 8. Fund III carry timing and currency hurdle

   Sheetal Kumar, Herons Management56:31

   Question. For dollar investors is the 8% hurdle seen in dollar denomination or rupee terms? Given European waterfall, Fund III carry will not reflect in quarterly results until hurdle plus capital is returned — when will performance fee of Fund III start showing?

   Answer, Gopal Jain, Managing Director and CEO. Performance income has two components: carried interest and gains on sponsor commitment. The good news is Fund III is already generating performance income from sponsor gains — this is already in our quarterly results (₹29.7 cr total performance income in Q1 includes a part from Fund III). Carried interest will come later in the fund's life, once the hurdle plus capital is returned. Cannot commit on timing.

   Partly answered.

9. 9. Long-term growth profile and scalability

   Manish, Shah Securities58:06

   Question. How should investors think about earning growth potential and scalability over the next 3-5 years as committed capital expands across these strategies? And how could Fund IV, Fund V, Eastgate and future strategies transform Gaja's earnings and AUM profile?

   Answer, Gopal Jain, Managing Director and CEO. Look at industry growth (AIFs growing to USD1 trn) and ask whether a 22-year firm can maintain historical trendlines. Between March 2024 and March 2026, profits grew at 35% CAGR. Beyond this, anything else becomes futuristic statements. Fund V (₹2,500 cr) and Eastgate (₹1,500 cr) add ~₹4,000 cr to ~₹3,200 cr fee-paying capital; economics will diversify from three to five funds across two strategies. Income trendline 24%/yr and profit trendline 35%/yr historically — no forward guidance.

   Not answered directly.

10. 10. Fund III benchmark and relative performance

    Ankit, Oculus Capital Growth Fund59:33

    Question. Our ability to raise more funds depends on historical performance. Fund III is at 9% IRR — over last 10 years Nifty has returned 11% CAGR and mutual funds 11-15% post-fees. What is the set being used to say Fund III is in the first quartile? How is 9% a good return?

    Answer, Gopal Jain, Managing Director and CEO. These are not our numbers — this is CRISIL data. Funds are benchmarked on a relevant cohort basis. While 9% may not look high in isolation, our track record spans four funds: Fund I was 5x+, Fund II was 3.8x MOIC (top-decile), Fund III and IV are top-quartile, and Fund IV is currently running at 29% gross IRR. This is how any LP will assess us, and it is why we have been able to attract high-quality capital directly without distributors.

Topic by topic, in the order it was spoken

In their words