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About Fund Manager

Ashwin Shetty ( Fund Manager )

Ashwin Shetty has more than 10 years of experience in equity research. He led the coverage of the automobile sector at Ambit Capital from 2010 to 2017. He was ranked in Starmine Analyst Awards 2013 and 2016 for his stock-picking abilities during this stint. He thereafter worked as a senior analyst for Ambit’s Mid and Small-cap PMS funds till November 2018. Prior to joining Ambit, he worked with Execution Noble as an analyst covering the consumer and media space. He has also worked with KPMG’s and Deloitte’s statutory audit departments from 2004 to 2007 gaining extensive experience across Indian accounting standards and financial statement analysis.

Qualifications: Ashwin Shetty is a BCom graduate from Narsee Monjee College (Mumbai). He is a qualified Chartered Accountant (ICAI India) and Chartered Financial Analyst (CFA Institute, USA).

Saurabh Mukherjea, FRSA Founder and Chief Investment Officer

Saurabh Mukherjea is the Founder and Chief Investment Officer of Marcellus Investment Managers. Saurabh was educated at the London School of Economics where he earned a BSc in Economics (with First Class Honours) and an MSc in Economics (with distinction in Macro & Microeconomics). In London, Saurabh was the co-founder of Clear Capital and in 2007 he was rated by the Extel Survey as one of the top small-cap analysts in the UK. In India, Saurabh was rated as the leading equity strategist in 2015, 2016, and 2017 by the Asiamoney polls. Prior to setting up Marcellus, Saurabh was the CEO of Ambit Capital.
Saurabh is a CFA charter holder and a SEBI registered investment advisor. In 2017, upon SEBI’s invitation, he joined SEBI’s Mutual Fund Advisory Committee. In 2019, Saurabh was part of the Expert Committee constituted by SEBI to update and upgrade the PMS regulations. Saurabh has written four bestselling books – Gurus of Chaos (2014), The Unusual Billionaires (2016), “Coffee Can Investing: The Low-Risk Route to Stupendous Wealth” (2018), and ‘The Victory Project: Six Steps to Peak Potential’ – and he is a Fellow of the Royal Society of Arts.

Pramod Gubbi, CFA

In the final two years of his 8-year stint in Ambit Capital, Pramod was Managing Director & Head of Institutional Equities (from 2016 to 2018).Prior to that Pramod, served as the head of Ambit’s Singapore office from 2013-to 2016. Before joining Ambit, Pramod worked across sales and research functions at Clear Capital, a British equity research firm. Pramod is Head of Sales in Marcellus and manages the sales & marketing efforts of the firm. He also sits on the Investment Committee that discusses and approves investment strategies of the firm.Besides being a technology analyst, Pramod has served in technology firms such as HCL Technologies and Philips Semiconductors’ Indian arm in Business Development and Engineering respectively.

Qualifications: Pramod is a CFA charter holder with a B.Tech from Regional Engineering College, Surathkal, and a Post-graduate Diploma in Management from the Indian Institute of Management – Ahmedabad.

Investment Philosophy

  • First step of Marcellus Little Champs is to position stocks on each of the 12 ratios individually. These ranks are then accumulated through parameters to give a final order on the accounting standard of stocks.
  • Objective of the Marcellus Little Champs investment team is to conduct research focused on 12 accounting ratios, including income statement (revenue/gains handling), balance sheet (correct representation of assets/gains), cash pilferage and quality audit checks.

Fees Structure:

Annual fixed fees of 1.5% (charged quarterly) Fees for performance: 20% of profits above a threshold of 10%. On the third anniversary, performance fees will be assessed on cumulative profits. The first 10% of annual returns (net of fixed fees) will not be subject to performance fees. Performance fees will be imposed without catch-up. Performance fees are based on the high water mark. Performance costs will be levied as of the redemption date if redeemed before the period of three years has expired. Exit Load: If redeemed in the first, second, or third year, respectively, it is 3%, 2%, and 1%. Investment requirement: 50 lacs

Performance

Except for Little Champs Portfolio, all performance data shown is net of fixed fees and expenses incurred through June 30, 2022, as well as net of annual performance fees incurred for client accounts whose account anniversary or performance calculation date falls up until the end of this performance period. The impact of this has not been taken into account in the performance data since Little Champs Portfolio performance fees are assessed on cumulative gains at the third anniversary of the corresponding client account.

Look for Hermann Simon’s celebrated ‘Hidden Champions

  • SMEs, sometimes family-owned, produce unnoticeable goods yet are the best in the world at those goods.
  • They often operate in narrow markets and create distinctive items utilizing exclusive methods.
  • Operate quite near to the clients who depend on their products and find it difficult to switch suppliers.
  • These companies’ competitive advantages are more often attributed to the quality, total cost of ownership, excellent performance, and tight client relationships than to cost leadership.

Unique Feature

  • About 50 stocks have entered or quit the BSE 500 annually on average over the past ten years, showing a significant level of churn.
  • The years before the stock is included in the BSE 500 index show the greatest relative outperformance.
  • Find small-cap firms with a market valuation of less than US$500 million that have demonstrated sound corporate governance, a successful track record with capital allocation, and long-lasting competitive advantages based on brands, operational procedures, and strategic assets.

Methodology A Few Of Our Forensic Ratios

  • 12 accounting ratios that examine cash theft, accurate reporting of assets and liabilities on the balance sheet, and revenue/earnings manipulation in the income statement. Consolidated historical financials spanning six years. Companies that score highest on each of the 12 measures separately (some examples are outlined in the table on the right). These rankings were then added together based on several criteria to provide a final ranking of the accounting quality of stocks. The renowned forensic accounting book “Financial Shenanigans” by Howard M. Schilit inspired the use of these ratios.

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