Abakkus Diversified Alpha Fund II

• Benchmark Agnostic portfolio of around 40 companies “Bottom Up” investing in companies with decent profitable growth
• Disciplined approach to investing across market caps and sectors
• Focus on a value-conscious style of investing
• Low churn long-term ideation-based approach to investing
• Endeavour to generate alpha over 3–5 years holding period
• Select IPO investments as an Anchor Investor \ QIB \ Pre IPO

Fund Characteristics

• Unique 40:30:20:10 approach to portfolio construction
• Capturing opportunities across market capitalization
• Lower volatility through large cap and larger mid-cap exposure
• Focus on alpha creation via exposure to mid, small & micro caps
• Risk discipline and management by way of position sizing
• Liquidity management as smaller capitalization companies have incrementally smaller weights

What To Expect

• Profitable Businesses
• Value Conscious Approach
• Alpha focus
• Diversification
• Value Unlocking
• Decent Earnings Growth
• Decent ROE
• Low Churn
• Investment rather than allocation
• Value paid commensurate to future profitability

AIF Positioning

Equity Market Outlook
Economic growth expected to accelerate, Valuations above 10-year average but reasonable. Indian economy relatively outperforming developed as well as other emerging markets

Portfolio Stance
Capturing opportunities across market capitalization 

Approach
Value-conscious style of investing in companies having robust business models and earnings growth

Alpha Generation Approach
Investment rather than allocation-based approach across market caps

Themes we are Positive on
Financials, Domestic Growth & Consumption, Manufacturing, Capex, and Digital \ IT

Expected Market Earnings CAGR
14-15% CAGR

Risk reward equation

• Expected returns must justify the risk / uncertainty taken
• A good company might not necessarily be a good stock
• Focus on the price we pay, and value derived
• What is in the price?

Patient investors

• Buy and hold
• Invest in a stock as if investing in a business
• Think like a partner

Agile and flexible

• Each investment opportunity is looked upon individual merit
• Not constrained to a particular theme or style

Alpha generators

• Believe in investing with an endeavour to generate alpha over the markets rather than just allocating within benchmark index
• Growth companies where profitability is expected to grow higher than market average
• Fundamentally underpriced stocks with reasonable growth expectations
• Mid Cap companies with a scalable business model and growth potential to become large cap

Fundamental driven

• Bottom-up research with focus on balance sheet
• Numbers speak more than presentations and hype
• Returns ultimately are all about earnings

Happy to be contrarian

• Prefer to be first, early and/or only investors
• Do not chase the momentum
• Open to look at companies across sectors, market caps and business cycles

Why Abakkus

Experience

Backed by a well-qualified dedicated team of professionals that have cumulative experience of ~200 years

Performance

A well-established performance track record over 2 decades in public equity funds and across all market cycles

Commitment

Follow a start-up culture with high degree of commitment, urgency and passion 

Positioning

Focused investment in Alpha plays beyond the large number of listed companies supported by non-consensus, in-house research and independent thoughts

Opportunistic

Greater flexibility in investing into new sectors, new themes which are backed by entrepreneur driven economy 

Consistent

Investment team has delivered consistently across market cycles