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 Emerging PMS and AIF products objectively invest in growth companies at lower price. These are those companies where profitability is expected to grow higher than the market average and, fundamentally companies share is underpriced.
• Abakkus Asset Manager 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.
• Abakkus Emerging PMS / AIF 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.
• 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 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 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