
Emkay GEMS Strategy Focused Midcap Investing | High-Conviction Portfolio | Risk-Adjusted Alpha Generation

Emkay GEMS Strategy Focused Midcap Investing | High-Conviction Portfolio | Risk-Adjusted Alpha Generation
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Emkay GEMS Strategy
The Emkay GEMS (Growth & Emerging Market Stars) Strategy aims to deliver long-term capital growth by investing in high-quality companies that are beneficiaries of India’s structural transformation. The strategy is centered around identifying businesses aligned with high-growth themes such as digital transformation, energy transition, financialization, manufacturing evolution, and domestic consumption—all key pillars of India’s next growth wave.
Investment Objective
The Emkay GEMS (Growth Enterprise Midcap Strategy) portfolio aims to deliver medium- to long-term capital appreciation by investing in 20 equi-weighted mid-cap stocks. The fund adopts a buy-and-hold approach, focusing on companies with:
- Strong economic moats
- Dominant positions in their sectors
- Long-term potential for wealth creation
Investment Philosophy: Growth at a Reasonable Price (GARP)
The GEMS Strategy is grounded in delivering risk-adjusted returns with a low-volatility, low-turnover approach. It avoids over-diversification and filters out low-quality, high-risk names to minimize portfolio risk.
Key principles include:
- Equi-weighted holdings to remove allocation bias
- High liquidity and quality filters
- Focus on governance, earnings strength, and valuation metrics
Investment Strategy: Quant Meets Quality
GEMS Strategy follows a structured framework using four key filters:
- Defined Market Cap Filter
Focus on NIFTY Midcap 150 universe to ensure targeted midcap exposure. - Earnings Growth Filter
- High RoCE / RoE > CoE
- Debt-to-equity ratio < 1
- Strong past performance and future growth visibility
- Valuation Framework
- PEG ratio
- Market Cap vs Opportunity Size
- Leadership Filter
- Strong sector leadership
- Trusted management credentials
The process narrows 5,000+ listed companies to a high-conviction basket of 20 midcap stocks with robust fundamentals.
Investment Theme
GEMS taps into high-growth midcap enterprises from the following transformational themes:
- Value Migration: Industries experiencing structural shifts with early-mover advantage
- Domestic Consumption: Sectors benefitting from rising GDP and consumer demand
- Efficiency Outliers: Companies with superior asset utilization and return metrics
Do Not Simply Invest, Make Informed Decisions
WISH TO MAKE INFORMED INVESTMENTS FOR LONG TERM WEALTH CREATION
