Emkay Lead PMS, a multicap strategy run by Emkay Investment Managers, stands out on top, having delivered 33.40 per cent return between November 1, 2018 and October 31, 2019.
With an equal weight of 6.70 per cent each, Bajaj Finance, Astral Poly Technik, Aarti Industries, Maruti Suzuki and Britannia Industries were among the top holdings of the Emkay Lead PMS.
Sectorwise, the fund had 33.50 weightage to BFSI and 26.80 per cent and 20.10 per cent to FMCG and building materials. It generated 3.90 per cent return in October against 3.95 per cent gain registered by BSE200 index.
Sameeksha Capital’s Equity Fund Strategy delivered 29.90 per cent to emerge second best for the calendar year to date, data compiled by PMSbazaar showed. The fund house had 43.10 per cent exposure to financials and 25.60 per cent to industrials.
“Our strategy is multi cap and bottom up,” says Bhavin Shah, Founder of Sameeksha Capital. “We try to understand the intrinsic value of companies based on long-term forecast of free cash flow in case of a non-financial company or excess return on equity in case of a financial company. We only buy when a company is available below its intrinsic value. We particularly find opportunity, when sell-side may not understand the dynamics and maybe a lot of mutual funds have not caught up with the story,” he said.
Aviation, IT and consumer discretionary had 9.10 per cent, 7.80 per cent and 4.90 per cent weightage, respectively, in the fund. However, Sameeksha’s Equity Fund declined marginally by 0.13 per cent in October, but generated more than 12 per cent in last three months.
Sanctum Wealth’s Indian Olympians (up 28.20 per cent), Motilal Oswal’s BOP (up 28.07 per cent), Varanium Capital Advisors (up 28 per cent) and Ambit Capital’s Coffee Can (up 27.80 per cent) were among other top gainers of last one year.
Sanctum’s Indian Olympians is a largecap-focused, concentrated PMS strategy. It says the objective is to generate long-term capital growth by investing in a concentrated portfolio of largecap companies having sustainable performance.
“We are predominately invested in financials and consumers in our strategy. Reducing overweight position in consumer discretionary last year and adding exposure in information technology sector worked really well, while, we had very low to nil exposure to utilities, industrials, commodities and communication services which helped us save on any significant drawdown,” said Hemang Kapasi, Portfolio Manager, Equity Investment Products, Sanctum Wealth Management.
Motilal Oswal’s BOP is based on four themes, which are related to PM Narendra Modi’s reformist measures including affordable housing, doubling of farm income, GST opportunity and migration of value happening away from public sector banks to private sector banks and NBFCs.
“Of course, it has to fulfil our additional criteria of structural businesses having good and capable management which can double profits in 3-4 years with a decent margin of safety. We suggest investors to invest for at least three years in this product,” said Manish Sonthalia, Fund Manager.
As of October 30, the fund had 66.21 per cent exposure to companies from FMCG, retail, banks, insurance and agriculture.
Ambit’s Coffee Can, which delivered 4.90 per cent return in October, had Page Industries, Asian Paints, Berger paints and HDFC Bank among its top holdings with maximum 31 per cent exposure to the building material space.
The benchmark BSE Sensex advanced nearly 17 per cent between November 1, 2018 and October 31, 2019, while the BSE Midcap index stood almost flat and Smallcap index dipped 5.60 per cent.
“It’s no brainer for largecaps right now,” said Sonthalia. There is far bigger value in midcaps and smallcaps . Funds flow is choked in midcaps and smallcaps because of regulations, etc. Prices are undershooting fundamentals in this space,” he said.
IIFL’s Multicap PMS (27.27 per cent), Sundaram AMC’s SISOP (27.10 per cent), ASK’s India Select (25.50 per cent) and Nippon India (25.10 per cent) also gained over 25 per cent in the past 12 months.
Sundaram’s SISOP is a multicap portfolio. The fund’s factsheet says it holds companies that maintain over 12 per cent RoCE/ self-funded models, led by high visionary leadership.
The fund had over 50 per cent exposure to Bajaj Finance, Titan, HDFC Bank, AU Small Finance Bank and Eicher Motors as of October 31.
IIFL’s Multicap holds 15-20 companies which are business leaders, have strong managements, lower leverage with large margin of safety. The fund generated 3.27 per cent return in October and 10.47 per cent in last three months.
ICICI Bank, Bajaj Finance, HDFC Bank, Axis Bank, Larsen & Toubro, Procter & Gamble, Crompton Greaves, Asian Paints, Siemens, Aavas Financiers, Muthoot Finance, Tech Mahindra and Creditacces Grameen were among the fund’s top holdings as of October 31.
Newly formed Marcellus’s Consistent Compounders gave 22.50 per cent in just six months. The fund was formed in December last year.
“Marcellus remains bullish on HDFC Banks, Kotak Bank, the Asian Paints and Pidilite,” Saurabh Mukherjea, founder and chief investment officer, Marcellus Investment, said in his latest interaction with ETNow.
“It looks conservative to buy these companies, but I have seen in India over the last 10 years that if you consistently and sensibly invest in these franchises, you make anywhere between high teens to low 20s returns consistently. For someone like me managing other people’s money, that is a perfectly acceptable outcome,” he said.
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