ALFACCURATE AAA PMS

Well-diversified, relatively low-risk portfolio

Key Attributes

Inception Date: 23 Nov 2009

Number of Stocks: 46

Fund Manager Name: Dr Rajesh Kothari

Fund Manager Experience: Total Exp – 20 Years, Founded AAA in 2009

Fund Manager Qualification: CWA and an MBA

Fund Manager Accolades: During his tenure as a Fund Manager at DSP Merrill Lynch Fund Managers (now DSP BlackRock Investment Managers), the equity assets under management flourished from USD 100mn to USD 1.5bn. Economic Times also recognized his performance and awarded him as a Platinum Fund Manager. Additionally, he won the CRISIL Mutual Fund of the Year Award in 2006 for DSP Merrill Lynch Equity Fund. During his tenure, the fund house also received the Lipper India Fund award for the Best Equity Fund Group for three years. Moreover, he has also been a keynote speaker at several international conferences/summits like Maharashtra Economic Summit, Institute of Directors, TradeTech Asia conference and The World Council for Corporate Governance.

Investment Objective

To invest in listed companies with a combination of high growth stocks as well as value stocks.

Portfolio Strategy

Investment Universe

• Diversification across industries
• Diversification across M-cap with focus on liquidity:

   • 40% in large cap INR275 bn+
   • 10% in one stock
   • 35% in one sector
   • 50% in the top 10 stocks
• Minimum investments in 30 stocks

Flexible investment style: Growth as well as Value with focus on Margin of Safety

Staggered Approach

• Portfolio exposure increased over a period
• Not averse to raise cash

Exit Strategy

• Close eye on earnings growth drivers
• Close eye on valuations

• Continuous monitoring of risk

3M Stock Selection Approach

• Market Size– Size of the opportunity should be huge to generate significant investment returns

• Market Share– The company be consistently profitable and should be among the leading players in the industry

• Margin of Safety– The company should provide reasonable growth opportunity at reasonable Margin of Safety

Investment Process

  1. Stock Identification

• Identify emerging trends and opportunities from a universe of 600 companies
• Filter approach – using variety of valuation parameters
• Focus on earnings, free cash flow, ROE, long term growth and profitability trends

 

  1. Analysis & Decision making Process

• Initial screening
• Corporate meeting and detailed due diligence
• Identify sustainable competitive advantage

 

  1. Portfolio Construction Monitoring & Nurturing

• Combination of Top Down and Bottom Up approach with a benchmark agnostic strategy to achieve Long term investment objective
• Continuous portfolio monitoring ensures prudent risk management
• Regular interaction to provide strategic inputs to strengthen systems, controls and CG in line with best practices

 

  1. Exiting & Realizing Value

• Constant evaluation of valuation metrics to decide optimum return potential
• Intrinsic value V/s Current Market Price to evaluate Margin of Safety
• Change in underlying assumptions of investment thesis.

Don’t Just Invest. Make an Informed Decision.