Motilal Oswal India Excellence Fund – Mid to Mega – Series II

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About company

MOFSL was founded in 1987 with 2 employees as a sub-broking unit with their main focus of customer-first attitude, ethical and transparent business practices, and many more. Today Motilal is a diverse firm that is working on a range of financial products and services such as Private Wealth, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Home Finance, etc. Motilal has clients of retail customers, mutual funds, foreign institutional investors, financial institutions, corporate clients, etc. They have more than 44,00,000+ customers across the globe. They make every decision with solid research at present they have 25+ research analysts researching over 250 companies across 20 sectors.

Fund Snapshot

Tenure of the Fund: 5 yrs + up to 2 yrs
Lock in (from final closing): 18 months
Exit Load: 18 – 24months – 3%, 24 – 36months – 2%, 36 – 48months – 1%, Nil thereafter
Commitment period: 12 months from final closing
Initial drawdown: 30% of capital commitment for non-SIP class
Final closing: 12 months from initial closing
Number of Stocks:



What is Mid to Mega?

 Crossover by the company from Midcap to Mega cap category

  •    Achievement of critical mass & scale
  •   Recognition by markets of the same

The above transition is mainly seen in companies who are

  • Industry leaders
  • Industry Tailwinds
  • Value migration beneficiaries

Classifying companies into Mini, Mid & Mega

Mega Top 100 companies Extensively researched
Mid 101st to 300th Companies Under researched, under owned
Mini 301st to 400th Companies Under researched, under owned

M-Q-G-L-P Investment Philosophy


  • Benefit of low-base
  • Well-established track record


  • Quality of business x Quality of management
  • Stable business, preferably consumer facing
  • Huge business opportunity
  • Sustainable competitive advantage
  • Healthy financials & ratios


  • Revenue growth and market share gains
  • Growth in margin & profitability
  • Reliable high growth flows


  • Long-term relevance of business
  • Extending competitive advantage period
  • Sustenance of growth momentum


  • Reasonable valuation, relative to growth prospects
  • High margin of safety

Portfolio Positioning

Manufacturing with focus on Exports

Contract manufacturing is booming, and production-linked incentive schemes are putting a lot of spotlight on this topic.

IT Services

Covid was instrumental in reducing the five-year investment in digitalisation to less than three years. Many businesses across all industries have been pushed to shift and implement digital processes, resulting in increased digitisation spending.

Cyclical Recovery theme

A wager on cyclical recoveries as well as a proxy for infrastructure and real estate investments.

Financials – Non-Lending

Insurance should be viewed as a multi-decadal growth industry. In this digital environment, capital market intermediaries and fintech are industries to watch.

About Fund Manager

Mr. Rakesh Tarway

Mr. Rakesh Tarway


  • Rich Experience: He has 18 years of expertise in the stock markets, with a focus on discovering and developing small and midcap enterprises.
  • Positions Held: He formerly worked at Motilal Oswal Securities and Reliance Securities as the Head of Midcap Research.
  • Track Record: Managing the ‘Motilal Oswal Focused Midcap Strategy successfully Since its debut, PMS has consistently outperformed the benchmark.
  • Academic Background: Rakesh graduated from Mumbai’s Jamnalal Bajaj Institute of Management Studies (JBIMS) with a Masters in Management Studies (MMS).


How would I know if I am eligible for a trading account?

Individuals, HUFs, NRIs, proprietary firms, partnership firms, and companies can all create trading accounts with Motilal Oswal Financial Securities Limited (MOFSL).

What is investing in for the long-term like?

There are many wealth baskets created for various time periods, such as long-term and short-term investments. Long-term Wealthbaskets have a greater annualised returns gain %, making them the greatest long-term investment.

From an Investors standpoint why investing in AIF is a good decision?

There are three main reasons to invest in AIF with Motilal Oswal. Behavioral Alpha, Manager Alpha, and Agency Alpha are the three. They are discussed in the following order:

  • Get Money when the price is right: Drawdown structure allows for timing market opportunities to be professionally managed
  • Have a framework to sell: Option to return partial money / mature fund early. Booking profits & exiting portfolio are decided by the Fund Manager
  • Best of both PMS & MF on the AIF platform: Flexibility in stock and sector allocations (PMS) and Execution efficiency of pool account (MF)

What are the factors supporting India’s Industrial growth as per Motilal Oswal for making long term investment?

  • Availability of cheapest labour in India
  • The working-age population of India is growing compared to the decreasing trend in China

 These factors bring India on the front foot in the light of “China + 1”

Investment Framework

Technology Enablers

  • India’s IT exports at USD 150 Bn+ > Saudi’s Oil Exports
  • Impact of Covid – Digital enablement is the need of the hour
  • Talent Pool – Unparalleled IT engineer pool of 45 lakh which is expected to go to ~100 lakh
  • India Cost advantage continues to sustain – Boston to Bengaluru

Platform Companies

  • B2C Stack Established: India’s stack is unique – Cheap Data + Free payment rail (UPI) + Aadhar
  • B2B Stack Emerging GST + OCEN (Open Credit Enablement Network) + ONDC (Open Network for Digital Commerce)
  • India not a big horizontally integrated market yet – Likes of Amazon, Flipkart are still a small part of overall consumption pie
  • Digital Rupee – Power of Programmability

Why Now?

  • Investing in tomorrow’s leaders by focusing on companies in the midst of the economic cycle: High Growth Prospects
  • Mid-cap stocks have typically outperformed others over time. In the long term, the mid-cap category has outperformed the large-cap and small-cap segments.
  • 5 Year Rolling Return Comparison: The present alpha levels of Nifty Midcap 150 above Nifty 100 are still at 3%, but mean reversion could push it up to 7%.
  • There is still plenty of room for growth in the Nifty Midcap100 vs the Nifty50. The Nifty Midcap 100/Nifty 50 ratio is a strong signal for investing in mid-cap stocks. The Mid Cap ratio peaked at 2.0 in 2018, and current levels imply that there is still opportunity for mid-cap growth, given that the trend line has been expanding over time.

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Disclaimer: Investing Involves Risk. This document is for information purposes only and should not be viewed as a legal offering document or solicitation. Offers to invest in this fund are made only by the Discretionary Portfolio Management Services Agreement. Past performance does not guarantee future results and there is no assurance that the managed accounts will necessarily achieve their objectives. We do not guarantee any returns in the hand of investors not we take any sort of accountability for the performance of the scheme. The above-mentioned data is collected from the respected Fund house please verify the same at SEBI website.