Approach
Philosophy
Look across industries and market-caps to build a bottom-up portfolio of the most compelling investments, bearing little resemblance to an index.
Look for 20-25%+ IRRs at our point of investment, with an emphasis on downside protection.
Disproportionately focused on dominant and emerging leaders, combining secular growth tailwinds with the scope for market share gains.
A genuinely long-term orientation gives leaders the duration to compound, and enables us to take a contrarian stance and capitalize on near-term opportunities.
Objectives
We underwrite our investments with a 5-year base case and a 3-year downside case. While we do not know how the portfolio may do in any single year, we aim to generate alpha net of fees over a full investment cycle, which we think of as five years.
We do not invest for relative returns versus the market. As mentioned earlier, we seek 20-25%+ IRRs at our point of investment.
We do not manage the portfolio for near-term volatility, and instead focus on the safety of capital in every investment we make. As value investors, we seek to capitalize on volatility.
We believe in stock-picking rather than hugging the index. We will concentrate in our best ideas, with 20-25 investments in total, of which 5-8 form the core, with the rest as satellites.
India presents numerous secular investment themes, and while they can be powerful tailwinds, we approach investing from a bottom-up perspective and will evaluate each opportunity for its standalone risk-reward.
We filter first for governance and then for risk-reward. If we do not trust management or accounting, the answer is an automatic no.
Strategy
Our core strategy seeks asymmetric investment opportunities, where we have limited downside, and the potential for meaningful upside. These opportunities are unearthed through deep work, or what we like to call "earned variant perception", and we look across industries and market-caps to find them.
Asymmetry: Safety + Certainty
We capitalize by taking a contrarian + long-term mindset
- 5-year investment case; test for 20-25%+ IRR at entry
- 3-year downside case; test for capital protection
- Business early in its growth/inflection cycle
- Temporary setback; cyclicality; transformation; turnaround
Insight: Earned Variant
Perception
Through deep work, we cut through noise and focus on the essence
- Short-termism; under-researched companies; complexity
- Long-term earnings power that is unappreciated by the market
- Deep, independent research focused on key drivers of business
- Differentiated thesis on the back of unique insights
System
At the heart of our investment efforts lies our operating system, built and honed over years, and representative of our experience, influences, and first-principles thinking. It consists of five interconnected pieces that combine to guide all aspects of our work – from origination, to execution, to evolution.
Flexible Orientation
Look across industries and market-caps to build a portfolio of the most compelling investments.
Deep Work
Dig as deep as possible to get to the bottom of an investment situation with the help of on-ground network built over years.
Repeatable Frameworks
Leverage frameworks to identify frequently repeated patterns that drive significant alpha generation.
Agile Process
A key source of our effectiveness is an investment process and technology stack, built ground-up for our approach to investing.
Continuous Improvement
To tie it all together, our team brings a high-performance culture to our work. We thrive on the prospect of continually getting better.