High Quality Consistent Compounders PMS
| Refer Link |
|---|
Product Presentation
| Refer Link |
|---|
Fee
| Refer Link |
|---|
Disclosure Document
| Refer Link |
|---|
Contact Us
| Refer Link |
|---|
Investment Strategy
Our High Quality Consistent Compounders PMS generates attractive absolute risk adjusted return over the long term by investing only in high quality listed companies run by honest and competent management teams at valuations that offer significant margin of safety. We follow a rigorous research and due diligence process to evaluate business and management quality and then patiently wait to invest in high quality companies at attractive valuations that lowers risk of not only permanent capital loss but also sub-par returns.
Investment Process
 |
Investing in high quality companies with strong growth potentialWe have a high threshold for business quality so we only invest in select sectors. We don't invest in global commodities like steel, oil & gas, etc and sectors that are structurally challenged due to low entry barriers, stringent regulations, high capital intensity, inability to pass on rise in input prices, etc. We only invest in companies that have a long history of delivering high return on capital, low to nil leverage, strong cash generation and limited or no equity dilution. Also earnings growth is paramount for us so we spend substantial time to build comfort that businesses we invest in can deliver above average growth (15%+ EPS CAGR) over our investment horizon. |
 |
High bar for judging management qualityWe only invest in companies run by managements that have a history of excellent execution evident in superior metrics than industry peers & demonstrated capability to capitalize on new opportunities. We like managements with high credibility as evident in their conservative commentary and ability to deliver on past stated business goals. We don't do a trade off between value and management/business quality. For us, good management quality is a binary function. We firmly believe in this: "If I can't sleep well being invested in someone during his bad times, it is not worth my time." |
 |
Rigorous business and promoter diligenceWe test every investment opportunity for clean corporate governance and sound capital allocation track record as well as possibility of disruption in its industry due to regulatory changes, tech developments, etc during our investment horizon. We also take feedback from several sources on promoter integrity and management's capability to deliver on stated business plans. This shapes our view on the attractiveness of the business. Our 360 degree diligence process involves channel checks, expert interviews and feedback from competitors as well as ex and current employees. We also study in detail how the industry has evolved, its current structure/dynamics and the impact of changing technology and regulations on it in other geographies especially China and US. We also take feedback from the start up ecosystem in India like from VC investors, founders, etc on how new business models can disrupt existing industry dynamics. |
 |
Investing at valuations that offer significant margin of safetyWe patiently wait for well managed companies to hit our conservative price target. We never pay for optionality and factor in conservative growth in our pricing. We believe this leads us to making investment decisions that may be contrary to the consensus view at that time, but will lead to superior returns over the longer term. However, we never dip our quality bar to look for value. |
 |
Take concentrated betsOur portfolio typically comprises a maximum of 15 stocks across industries. We track investments closely for any deviation from the investment thesis and proactively look for non conforming data. Over time, we dispassionately cull-out our non-performers and re-allocate that money to the winners. |
|
Investing in high quality companies with strong growth potentialWe have a high threshold for business quality so we only invest in select sectors. We don't invest in global commodities like steel, oil & gas, etc and sectors that are structurally challenged due to low entry barriers, stringent regulations, high capital intensity, inability to pass on rise in input prices, etc. We only invest in companies that have a long history of delivering high return on capital, low to nil leverage, strong cash generation and limited or no equity dilution. Also earnings growth is paramount for us so we spend substantial time to build comfort that businesses we invest in can deliver above average growth (15%+ EPS CAGR) over our investment horizon. |
|
High bar for judging management qualityWe only invest in companies run by managements that have a history of excellent execution evident in superior metrics than industry peers & demonstrated capability to capitalize on new opportunities. We like managements with high credibility as evident in their conservative commentary and ability to deliver on past stated business goals. We don't do a trade off between value and management/business quality. For us, good management quality is a binary function. We firmly believe in this: "If I can't sleep well being invested in someone during his bad times, it is not worth my time." |
|
Rigorous business and promoter diligenceWe test every investment opportunity for clean corporate governance and sound capital allocation track record as well as possibility of disruption in its industry due to regulatory changes, tech developments, etc during our investment horizon. We also take feedback from several sources on promoter integrity and management's capability to deliver on stated business plans. This shapes our view on the attractiveness of the business. Our 360 degree diligence process involves channel checks, expert interviews and feedback from competitors as well as ex and current employees. We also study in detail how the industry has evolved, its current structure/dynamics and the impact of changing technology and regulations on it in other geographies especially China and US. We also take feedback from the start up ecosystem in India like from VC investors, founders, etc on how new business models can disrupt existing industry dynamics. |
|
Invest at valuations that offer a significant margin of safetyWe patiently wait for well managed companies to hit our conservative price target. We never pay for optionality and factor in conservative growth in our pricing. We believe this leads us to making investment decisions that may be contrary to the consensus view at that time, but will lead to superior returns over the longer term. However, we never dip our quality bar to look for value. |
|
Take concentrated betsOur portfolio typically comprises a maximum of 15 stocks across sectors. We track investments closely for any deviation from the investment thesis and proactively look for non conforming data. Over time, we dispassionately cull-out our non-performers and re-allocate that money to the winners. |
