Global
 

A Proven Investment Philosophy

Our Approach To Investing

We follow a simple, yet well-disciplined approach to investing. We identify businesses that have strong moats. These businesses are structurally well-positioned with sustainable competitive advantages and superior execution capability ensuring consistent long-term growth.

Over the last two decades, our investment philosophy backed by our proprietary research tools has enabled us to mitigate market volatility and outperform the benchmarks.

We are amongst India’s first asset management companies to follow a clearly stated Socially Responsible Investment (SRI) philosophy. Since inception, we have not invested in companies engaged in the business of tobacco, alcohol, gambling, etc. We are now a signatory to the United Nations Principles of Responsible Investing (UNPRI) which will further strengthen and integrate our in-house ESG framework.

The team’s efforts to conduct independent on-ground bottom-up research ensure a deep insight into each business that we track. Further, our risk management framework ensures a disciplined approach toward investing.

We are the first AMC, to adopt Global Investment Performance Standards (GIPS).

The Pillars Of Our Investment Philosophy

Opportunity

When evaluating a particular company, we ascertain the size, attractiveness, and addressability of the opportunity. Value creation is determined by its ability to leverage this opportunity and scale the business sustainably over time.

Longevity

Longevity is amongst the most valuable yet underrated traits in investing! We look for a business model that is highly predictable, sustainable, and durable. Over time, the business model should demonstrate resilience across economic and business cycles. We rely on our internal proprietary models for evaluating the same. This understanding helps us select suitable investments that provide sustainable and competitive returns that will compound over the long term.

Management

Integrity, Intellect, Intent, Innovation, and Implementation are core management traits that separate a good business from a mediocre one. We seek to engage and invest with companies that follow high standards of corporate governance adhering to high-quality transparency and disclosure standards.

Value Accretion

Value is created with consistent growth, improving returns, and business model durability. We look for a minimum threshold for Return On Capital Employed (ROCE), and Return On Equity (ROE). The company should be positive on Economic Value Added (EVA), generating Free Cash Flows (FCF) to sustain incremental growth. We also give due importance to incremental improvements in these characteristics of the business. We are very watchful of improper capital allocation that can be value destructive.

Discipline – Bedrock of Investing

Discipline is an integral part of our ethos and forms the bedrock of our investment process. From conducting bottom-up research, stock selection, allocation of securities, portfolio monitoring & reviews. We remain conservative and disciplined in our approach that guides us to differentiate between value-based and hype-based buying.