“Our strategy is a win-win in the long term”: PMS Fund Manager reveals strategy

“Our strategy is a win-win in the long term”: PMS Fund Manager who earned 9% in April reveals his investment strategy & top small-cap stock picks. The return is impressive because the Nifty lost 2.07% in April 2022.

A little known PMS Fund named “Emerging Opportunities strategy” of Equitree Capital has emerged as one the top performers in April 2022. The fund primarily invests in smallcap stocks and has returned over 9 per cent in April. It holds stocks like SP Apparels, Shree Pushkar Chemicals and Fertilisers and Rupa & Company, the ET reported.

Pawan Bharaddia, Cofounder, Equitree Capital explained the secret of his success in plain tems:

“Our investment philosophy is very simple. We are deep value investors focused on investing high quality micro and smallcap companies. We stay invested as long as the growth is visible, valuation stays reasonable and there are no other structural issues with the investment,” he said.

He added that while it is important to focus on returns, it is more important to protect the capital first. “We are more biased towards downside risk protection even at the cost of giving up riskier quick returns. And our strategy has been a win-win in the long term.”

Another little known Fund named Avestha Fund Management returned 11 per cent in April 2022. It holds winning stocks like Apcotex, AU Small Finance Bank, Max Healthcare, Praj Industries and PI Industries.

The ET also stated that among other top performers were Hem Securities’ India Rising SME Stars and Green Portfolio’s Super 30 and Dividend Yield strategies, which returned 6-9 per cent in April. All three strategies have ample holdings in smallcap stocks.

Saurabh Mukherjea-founded Marcellus’ Little Champs strategy returned 3.44 per cent during the month. Sunil Singhania’s Abakkus Emerging Opportunities delivered 2.7 per cent returns. However, these two were outliers as most other strategies by celebrity fund managers were either flat or delivered negative returns, the ET noted.

It was pointed out that Marcellus’ Kings of Capital that invests in bank and financial stocks were among biggest losers, down 3.1 per cent. Prashant Khemka’s White Oak Capital India Pioneers Equity was also down about 3 per cent. Samir Arora’s India Rising, Devina Mehra’s India Super 50 and Marcellus’ Rising Giants were others that returned in red during April.