Carnelian Capital Compounder Fund

• Carnelian Capital Compounder Fund believes in growth investing at fair valuations and obsesses about the risk-reward trade-off at Carnelian. The fund favours definite returns over immediate returns as long-term investors, and don’t mind short-term underperformance.
• When the risk-reward payoff is convincing, they are willing to be contrarians, and don’t mind sitting on cash when we see weakness.

Investment Framework

Carnelian Capital Compounder Fund investment framework is structured around four key pillars:

1. Quality – Focuses on business and management quality.
2. Growth – Includes:
   • Magic: Accelerated earnings growth and valuation re-rating.
   • Compounder: Sustainable earnings growth.
3. Forensic Analysis (CLEAR) – Evaluates:
   • Cash flow analysis
   • Liability analysis
   • Earnings quality analysis
   • Asset quality analysis
   • Related party & governance issues
4. Valuation – Ensures reasonable valuation relative to growth.

The framework emphasizes “Quality Growth at a Reasonable Price”, integrating business quality, earnings sustainability, forensic risk analysis, and fair valuation.

Carnelian Advantages Over Competitors

Carnelian Capital has a unique approach & unique insights into investing. Carnelian Capital is an exceptional independent, entrepreneurial boutique with a reputed board of advisors. Carnelian focuses on long-term approach with high active share (differentiated portfolio), Concentrated QGARP portfolio –Quality Growth companies (Business & Management) at a Reasonable Price. This offers them a unique blend of companies with accelerated and sustainable growth proprietary forensic analysis known for identifying larger themes, trends /stocks early.

People

Carnelian Capital founders are Industry veterans with strong complementary skill sets. They have a deep understanding of capital markets, businesses & strong relations with corporate India/industry which helps them invest in the right fund.

Process

Carnelian Capital focuses on a unique forensic framework –“CLEAR”. Carnelian Capital focuses on quality. Carnelian follows a disciplined investment process & it has a differentiated approach to risk management.

Create wealth by finding high-growth, high-quality businesses

Key Features:

• Diversified Portfolio: Invests in a mix of large, mid, and small-cap listed companies in a 50:30:20 ratio.
• Selection Criteria: Targets businesses with niche expertise, strong growth potential, proven track records, and excellent management.
• Portfolio Composition: Holds 20-25 stocks and is benchmarked against the BSE 500 TRI.

This strategy aims to achieve sustainable long-term growth by identifying high-quality companies with scalable opportunities.