  We report on recent near-IR observations of V4332 Sgr - the nova-like
variable that erupted in 1994. Its rapid, post-outburst evolution to a cool M
type giant/supergiant, soon after its outburst, had showed that it was an
unusual object differing from other eruptive variables like classical/symbiotic
novae or born-again AGB stars. The present study of V4332 Sgr was motivated by
the keen interest in the recent eruption of V838 Mon - which along with V4332
Sgr - is believed to belong to a new class of objects (we propose they may be
called "quasi-novae"). Our observations show new developments in the evolution
of V4332 Sgr. The most striking feature is the detection of several molecular
bands of AlO - a rarely seen molecule in astronomical spectra - in the JHK
spectra. Many of these bands are being detected for the first time. The only
other detection of some of these AlO bands are in V838 Mon, thereby showing
further spectral similarities between the two objects. JHK photometry shows the
development of a new dust shell around V4332 Sgr with a temperature of ~ 900K.
This dust shell does not appear to be associated with ejecta of the 1994
outburst but is due to a second mass-loss episode which is not expected in a
classical nova outburst. The cold molecular environment, suggested by the AlO
emission, is also not expected in novae ejecta. We model the AlO bands and also
discuss the possible formation mechanism of the AlO.
