Morgan Stanley Said to Consider $500 Million India Fund, Shifts some Assets

Why It Matters

The fund offers liquidity for current investors and taps growing demand for secondary‑market investments, potentially deepening capital flow into India’s healthcare sector.

Key Takeaways

• Morgan Stanley targeting $500M for India continuation fund
• Moves eight healthcare assets into new vehicle
• Omega Hospitals and RG Scientific among transferred investments
• Continuation fund reflects surge in secondary market activity
• Secondary market grew 48% to $240B in 2025

Pulse Analysis

Morgan Stanley’s decision to launch a $500 million continuation fund for Indian healthcare assets underscores a strategic pivot toward secondary‑market financing. By moving eight portfolio companies, such as Omega Hospitals and RG Scientific, into a dedicated vehicle, the firm can extend the investment horizon, offer liquidity to early backers, and attract new capital without the pressures of an IPO. This approach reflects a broader trend where private equity managers create continuation vehicles to preserve value and manage portfolio risk in volatile markets.

The secondary‑market environment has accelerated dramatically, with Jefferies reporting a 48 % jump to $240 billion in 2025. Investors increasingly favor these platforms for their ability to provide quicker exits and diversified exposure to mature assets. For Morgan Stanley, leveraging this momentum not only enhances its product suite but also positions the firm as a leader in alternative fund structures, catering to institutional demand for steady, income‑generating investments amid uncertain equity markets.

For India’s healthcare sector, the continuation fund could translate into sustained capital support for growth initiatives, technology upgrades, and expansion into underserved regions. As the fund attracts both domestic and foreign investors, it may catalyze further consolidation and innovation within the industry. Moreover, the visibility of a major global manager committing substantial resources signals confidence in India’s long‑term healthcare outlook, potentially encouraging additional foreign direct investment and reinforcing the country’s position as a burgeoning market for health‑tech and services.

Morgan Stanley said to consider $500 million India fund, shifts some assets

Bloomberg · Last Updated: Feb 13 2026, 06:49 PM IST

Morgan Stanley’s asset‑management arm plans a $500 million India continuation fund, moving healthcare investments such as Omega Hospitals and RG Scientific into a new vehicle.

The firm is sounding out investors about shifting a portfolio of India assets from an existing fund into a new vehicle, according to people familiar with the matter.

It intends to move eight healthcare‑focused investments into a so‑called continuation vehicle. The sources, who asked to remain anonymous because the conversations are private, said the firm is seeking to raise $500 million for the new India fund strategy and has already approached investors.

The assets include Omega Hospitals and RG Scientific Enterprises Pvt. Morgan Stanley Investment Management invested in Omega in 2024 with a minority stake and bought a controlling stake in RG Scientific that same year.

A media representative for Morgan Stanley declined to comment.

Morgan Stanley Investment Management, a $1.9 trillion manager, invested in the assets through its alternative arm, Morgan Stanley Private Equity Asia.

The continuation fundraising comes as more investment firms look for exit routes beyond initial public offerings and mergers. Globally, the secondary‑market rose 48 % to $240 billion in 2025 from a year earlier, according to a report by Jefferies Financial Group Inc.

Synopsis

Morgan Stanley Investment Management is exploring shifting eight India healthcare assets into a continuation vehicle, targeting $500 million from investors. Investments include Omega Hospitals and RG Scientific, reflecting rising secondary‑market activity, according to Jefferies Financial Group data.