Centrum Microcap

• Centrum Microcap fund aims to invest mainly in equity/equity-related instruments of companies that can be categorised as microcaps in order to achieve long-term capital appreciation.
• Exposure to large-cap stocks can be taken in a weightage that is deemed acceptable based on market conditions to provide portfolio stability.

EDGE Framework

• Earnings Growth (E): driven by criteria such as minimum ~15% EBITDA growth and ~15% ROCE | High cash to EBITDA ratio (65% and above) | Low leverage (<2x)
• Deep Dive Research (D):driven by factors like size of the opportunity, competitive advantage, scalability and channel checks
• Governance (G): evaluated based on accounting quality, past capital allocation, past related party transactions and dividend policy
• Execution (E):past track record and promise vs delivery historically

The above-mentioned EDGE framework is used to identify leaders.

Leadership traits are defined as

• Market Share
• Promoter/Management Pedigree
• Operating Margins and Return Ratios
• Brand/Distribution Strength
• Business Growth and Pricing Power
• R&D and Technology Differentiators