India's Portfolio Management Services (PMS) and Alternative Investment Funds (AIF) industry is experiencing a period of unprecedented growth, reaching record highs in assets under management. According to a recent report by PMS Bazaar, the combined assets of PMS and AIFs have exceeded ₹23.43 lakh crore as of September 2025, marking a decade-high expansion. This surge is attributed to increasing participation from institutional investors and a significant shift among affluent investors towards strategy-led portfolios.
Over the past decade, the alternative investment ecosystem in India has grown at a compound annual growth rate (CAGR) of 31.24%. This represents a substantial increase from ₹1.54 lakh crore in 2015. The PMS segment has seen a remarkable sevenfold expansion during this period. Assets Under Management (AUM) in the PMS sector, including discretionary and non-discretionary mandates but excluding co-investments and advisory assets, have risen from ₹1.27 lakh crore in September 2015 to ₹8.37 lakh crore in September 2025, demonstrating a 10-year CAGR of 20.75%. This growth has coincided with an increase in the number of licensed managers, with 495 SEBI-registered portfolio managers currently active.
The AIF segment has experienced even more dramatic growth. Total AIF commitments have surged from ₹27,484 crore in September 2015 to ₹15.05 lakh crore in September 2025, translating to a striking 49.23% CAGR. Category II AIFs, which constitute approximately three-fourths of total commitments, have spearheaded this growth, soaring from ₹14,707 crore to ₹11,20,589 crore during the same period, reflecting a 54.24% CAGR. As of November 17, 2025, India hosts 1,699 registered AIFs across all categories, highlighting the diversification of domestic alternatives.
R. Pallavarajan, Founder & Director of PMS Bazaar, noted that affluent investors are increasingly seeking diversification and reliable sources of alpha. PMS and AIF platforms provide conviction-led, strategy-driven portfolios tailored for today's complex market environment. George Heber Joseph, CIO & CEO (Equity) at ASK Investment Managers, added that the rising demand comes not only from High Net Worth Individuals (HNIs) but also from Ultra High Net Worth Individuals (UHNIs). These investors are actively seeking research-backed, structured solutions to diversify and grow their wealth.
GIFT (Gujarat International Finance Tec) City is emerging as a key gateway for capital, with projections estimating fund commitments at GIFT City's International Financial Services Centre (IFSC) to exceed USD 100 billion by 2030. As of June 30, 2025, the IFSC was home to 177 registered fund management entities and over 270 funds or schemes, spanning Category I, II, and III AIFs, as well as Venture Capital funds. Category III AIF commitments have nearly tripled in one year to USD 10.15 billion, demonstrating rising global investor interest in India-centric strategies. The growth of GIFT City's IFSC is supported by policy clarity and increasing appetite from Non-Resident Indians (NRIs) and global investors.
PMS Bazaar also launched AIF Bazaar, a specialized platform aimed at improving transparency and access for Alternative Investment Funds. This platform is expected to help investors evaluate products and fund managers more effectively as participation in alternatives grows.
