Abakkus All Cap Approach PMS


Abakkus All Cap Approach PMS

KEY PORTFOLIO ATTRIBUTES #

Year of Inception 29-10-2020
Number of Stocks -
Alpha (1Y) 10.33%
Beta (1Y) 0.68

About Abakkus Asset Manager LLP

Abakkus Asset Manager LLP is an alpha-focused asset manager based in India. Mr. Sunil Singhania founded it in 2018 and called it after the simplest ancient computing device, the abacus. The goal and aim of Abakkus is to become one of India’s most reputable and successful asset managers. This ideology has shaped the Abakkus portfolio’s beliefs: Keep things as straightforward as possible. Be a firm believer in the basics. Focus on the fundamentals and numbers.

Key People

Sunil Singhania
Sunil Singhania Founder
Aman Chowhan
Aman Chowhan Portfolio Manager
Deven Sangoi
Deven Sangoi Portfolio Manager

Investment Objective

Abakkus is an Alpha Focussed Asset Manager. Abakkus All Cap Approach PMS is a multi-cap PMS designed to generate alpha and risk-adjusted returns for clients by investing in benchmark agnostic portfolio across market capitalization. The idea is to focus on growth in value.

Abakkus All Cap Approach PMS is a well diversified, aspiring leaders portfolio that makes selective sector calls with a contrarian approach and usually are first investors.

Investment Strategy

• Abakkus All Cap or Abakkus Growth PMS is a benchmark agnostic diversified All-cap portfolio.

• Abakkus All Cap PMS is fundamentals based portfolio constructed with bottom-up approach.

• Abakkus All Cap PMS strives for Alpha from exposure to broader market companies with sustainable business and high ROEs.

• Abakkus All Cap PMS endeavors to generate alpha and wealth creation by buying with typically 3-5 years holding period.

• Abakkus likes 2nd or 3rd player within a sector available at a significant discount to the leader.

• Abakkus follows “MEETS” Framework which stands for Management, Earnings, Events/Trend, and Timings.

Abakkus Asset Managers' MEETS Framework

Management

• Check the quality, capability, and track record of the management of the investee companies

• Analyse the Capital Expenditure. Keep an eye if the ROE is maintained or enhanced.

• Check for decisional errors; whether the management makes business errors or avoidable mishaps.

Earnings

• Deep dive into financials – check for quality of earnings v/s reported numbers

• Constantly analyse the Actual Earnings v/s the Expected Earnings AND the Cyclical Earnings v/s the Structural Earnings

• Generally look to invest in companies which have the potential to double profits in 4 years or less or where EV/EBITDA can halve in four years

Events / Trends

• Monitor stock price movements because of evolving market trends

• Unlock disruptive themes & events on the horizon

Timing

• Keep a tab on price discounting

• Monitor the time frame of investment, in accordance with the Mean Reversion

Structural

• Understand the competitive positioning & the MOAT of the business

• Evaluate the size of the opportunity

• Consistent growth in profits

Investment Philosophy

Growth in Value

• Abakkus Asset Manager follows the ‘approach of growth in value investing’, which means, identifying those companies which are value picks in terms of its stock price versus its business earnings. Companies with traits & more potential  for growth in sales, market share and earnings.

• Abakkus Asset Manager believes that such companies have not only margin of safety because of the low investable price but also, a high scope of stock getting re-rated as the growth story becomes more visible to the market.

• Following Abakkus’ philosophy of finding growth in value may sound simple, but it is not easy and very few companies are able to do it well. Most get stuck in value and which over time becomes a deep value as if growth doesn’t follow.

• Abakkus All Cap PMS invests in growth companies. These are those companies where profitability is expected to grow higher than the market average and, fundamentally companies share is underpriced.

Patient Investors

• Abakkus Asset Managers’ All Cap PMS follows Buy & Hold. This means, investment team at Abakkus Invests in company’s stock/share, as if investing in the business like a partner and not like a share trader.

Maximising Alpha

• Abakkus All Cap Approach PMS invests in small & mid companies with a scalable business models. This means businesses with strong growth potential of becoming larger companies where by small cap becomes mid cap and mid cap becomes a large cap over time.

Fundamentals Driven

• Abakkus Asset Manager follows a Bottom-up research. This means, selecting portfolio companies with a focus on profit & loss statements, balance sheet, cash flow statements, and valuations.

• Abakkus All Cap Approach PMS is a Multicap portfolio of ~40% Large & ~60% in Mid & small companies.

Contrarian Approach

• Abakkus prefers to be a contrarian: Investing in companies, where other investors still do not have high conviction. Based on knowledge of companies growth potential, once convinced, Abakkus doesn’t hesitate investing early, as a first investor or as an only investor.

Avoid 4 Cs

• Chase Momentum

• Churn Unnecessarily

• Copy & Mimic

• Credit Risk – Fractured Balance Sheet

Exit Discipline

• Exit if fundamentals don’t pan out as expected due to sector deterioration, company specific issues, governance issues

• Not shy to accept when thesis goes wrong

• Exit if position becomes insignificant and can’t / don’t want to add

• Exit if a new investment idea stems up which is better than existing business(es) in terms of risk reward

Awards & Achievements

• In 2023, Abakkus Asset Manager Growth Fund-I, a Long Only Cat III AIF, was awarded Rank #2 in the Best Long Only Cat III AIF, on 3Y Risk-Adjusted Returns. These Awards were hosted by PMS AIF WORLD, in association with IIM-Ahmedabad.

• In 2023, Abakkus Asset Manager’s Emerging Opportunities Fund-I, a Long Only Cat III AIF, was awarded Rank #1 in the Best Long Only Cat III AIF, on 3Y Risk-Adjusted Returns. These Awards were hosted by PMS AIF WORLD, in association with IIM-Ahmedabad.

• In 2022, Abakkus Asset Manager Growth Fund-I, a Long Only Cat III AIF, was awarded Rank #2 in the Best Long Only Cat III AIF, on 3Y Risk-Adjusted Returns. These Awards were hosted by PMS AIF WORLD, in association with IIM-Ahmedabad.

• In 2021, Abakkus Asset Manager’s Emerging Opportunities Fund, a Long Only Cat III AIF, was awarded the winner in the Best Long Only Cat III AIF, on 1Y Absolute Returns. These Awards were hosted by PMS AIF WORLD, in association with IIM-Ahmedabad.

• Mr. Sunil Singhania has been revered as the amongst the Best Fund manager by Outlook Business in 2016 and 2017 over a 10-year time span.

• Reliance Growth Fund, a midcap oriented fund directly managed by Mr. Sunil has unique distinction of having grown over 100 times in 21 years. Also, the first fund in India to have a NAV of Rs. 1,000+.

Performance Table #


Trailing Returns (%) 1m return 3m return 6m return 1y return 2y return 3y return 5y return 10y return Since inception return
Abakkus Asset Manager All Cap Approach1.82%13.59%15.21%38.64%17.34%31.51%--34.16%
BSE 5001.92%17.88%16.20%33.42%16.47%21.89%--26.13%

QRC Report Card *




VIEW DETAILED QUALITY, RISK, CONSISTENCY ANALYSIS

Portfolio Holdings


Holding %

Sector Allocation


Holding %

Market Cap Allocation


Allocations %
Large Cap
Mid Cap
Small Cap
Cash

Do Not Simply Invest, Make Informed Decisions

WISH TO MAKE INFORMED INVESTMENTS FOR LONG TERM WEALTH CREATION

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From the Founders & Managers of Abakkus Asset Manager PMS

What to expect from Abakkus All Cap Approach PMS?

Abakkus Asset Manager LLP is an alpha focused asset manager investing in Indian Equities. Founded in 2018 by Mr. Sunil Singhania with a vision to make Abakkus, one of India’s most revered and top performing asset managers. Over the last 4 years, Abakkus has launched funds under the Category III AIF and the PMS platform. AMC today manages ~ Rs 9,000 crores of assets.

 

All Cap Approach portfolio is a Benchmark agnostic diversified portfolio adhering to proprietary “MEETS” investment framework. It focuses on bottom-up investment ideas with focus on stocks which can double their earnings in next 4-5 years. Portfolio typically will have 35-50% allocation towards large caps and rest is in broader markets. Typically, focus area of the portfolio in broader market is in companies that are between Rs 5,000 crs to Rs 35,000 crs range.

 

Portfolio looks at decent earnings growth of atleast mid-teens, while not overpaying in terms of valuations. Owing to this, typically you will not find the richly valued quality or over-hyped names in the portfolio as most of these names trade at an significant premium to market levels and are priced to perfection.

 

Within large cap our focus is on investing in companies with earnings visibility and slightly contrarian to industry peers while our mid cap exposure is typically into companies which are 2nd or 3rd player but known player in their segment of operations and that have sustainable business with over 15% ROEs.

Who should invest in this PMS?

Those investors seeking for differentiated portfolio can invest in this strategy with horizon of 4-5 years. Portfolio has a blend of large caps to focus on stability during volatile times as well as decent broader market exposure to focus on alpha generation. The portfolio manager’s endeavour is to invest judicially rather than just by allocation basis which has helped in generating risk adjusted returns in the past.

Which is the best company through which an investor can invest in Abakkus All Cap Approach PMS?

We recommend PMS AIF WORLD, because, it is one unique platform that offers real knowledge driven investing with their highly meaningful data, reports, and content that is written very well. PMS AIF World is a team of highly articulate, educated, and experienced people.

Disclaimer

#Returns as of 31 Jan 2024. Returns up to 1 Year are absolute, above 1 Year are CAGR.

*QRC Report Card data is updated quarterly. Current data is as of Dec 23.


Do Not Simply Invest, Make Informed Decisions

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