CapGrow – Special Situations Strategy PMS


Key Portfolio Attributes

Inception Date: 31st October 2018

Portfolio Manager’s Name: Mr. Arun Malhotra

Portfolio Manager’s Experience: 25 years of experience in the Indian Capital markets across various foreign companies- has rich experience of investment in Indian stocks , compliance and business development.

Portfolio Manager’s Qualification: executive MBA from FMS Delhi during 1997-2000 full-time two-year M.B.A (2001-03) from one of the top business schools in Finance - Simon Business School, University of Rochester, New York.

Investment Objective

The objective of CapGrow- Special Situations Strategy PMS is to gain supernormal returns generated due to the occurrence or non-occurrence of a special situation which takes place due to corporate actions like spin-offs, de-mergers, M&As, capital structure dislocations, distressed securities, statistical imperfections, and so on. The USP is to understand the events, promoter/mgmt. behavior behind it and arrive at a probability based outcome.

Investment Philosophy

The portfolio will invest in listed equity and equity related instruments majorly but may have some exposure to debt instrument. The investment style is to enter the stock once the event is confirmed and then as value unlocking happens, big alpha is generated over a time horizon. Each & every investment made, is backed by solid fundamental reasoning, robust thought process and a keen desire to generate supernormal returns.

Investment Process

• Industry analysis: Size of Opportunity, Number of Competitors, Current and historical capacity utilization of the industry, sectoral growth rates, threats of substitutes to the industry, any regulatory threats etc.

• Company analysis: Moat, Leader in their businesses, networking effect, Margin analysis, cost competitiveness, source of growth for the company, decoding margins and operating leverage in the business, capital efficiency (ROE + ROCE).

• Cash Flow analysis: DCF, balance sheet analysis (avoid debt/highly leveraged companies, contingent liabilities).

• Strong corporate governance: Very is very critical

• Other Parameters: Promoter’s pledge, their other businesses if any. Past Dividends and corporate events, equity dilutions.

• Valuations: DCF, EV/EBITDA, P/E, deal multiple valuations.

Finally, the price which one pays for the stock is a function of all the above parameters. Follows highly focused and research driven process to select stocks in the portfolio




Performance Table #


Trailing Returns (%) 1m return 3m return 6m return 1y return 2y return 3y return 5y return 10y return Since inception return
Portfolio10.5%15.5%6.0%7.3%40.6%30.9%--19.2%
Nifty 5004.5%8.5%7.1%5.3%27.9%19.5%--15.7%



QRC Report Card *




VIEW DETAILED QUALITY, RISK, CONSISTENCY ANALYSIS

Portfolio Holdings


Holding %
Indiabulls Real Estate Limited 10.05
FORBES & COMPANY LTD 9.01
SASKEN COMMUNICATION TECHNOLOGIES LTD. 5.81
IDFC LIMITED 5.68
FORTIS HEALTHCARE LIMITED 5.55
Top 5 Equity Holdings 36.10

Sector Allocation


Holding %
Pharma 7.92
Hospitals 9.35
Real Estate 11.77
BFSI 16.35
Consumer 17.66

Market Cap Allocation


Allocations %
Large Cap 10.0
Mid Cap 29.9
Small Cap 56.2
Cash 3.9


Do Not Simply Invest, Make Informed Decisions

WISH TO MAKE INFORMED INVESTMENTS FOR LONG TERM WEALTH CREATION

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Disclaimer

#Returns as of 31 Aug 2022. Returns up to 1 Year are absolute, above 1 Year are CAGR.

*QRC Report Card data is updated quarterly. Current data is as of Sep 21.




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