Alchemy High Growth PMS Strategy: 22 Years of Longevity, Resilience and Growth!
Investing in stocks to achieve high future growth is a key strategy for maximizing returns in today’s dynamic market environment. Bearing this fact in mind, Alchemy Capital Management offers a solution through its PMS strategy, Alchemy High Growth.
In this blog, we will explore the key features, investment philosophy, and performance metrics associated with the strategy.
Key Features of the Alchemy High Growth:
Alchemy High Growth’s objective is to generate long-term returns by investing in equities and equity-related instruments across all market capitalizations. This investment strategy is tailored for those seeking sustainable growth through a diversified portfolio that spans various sectors and company sizes. The strategy’s primary feature is to identify and invest in companies with strong growth potential, thereby endeavoring to maximize returns over the long term.
1. Basis of Stock Selection
Relevant Universe:
The process begins with identifying a relevant universe of approximately 500 companies. These companies are filtered based on market capitalization, qualitative governance standards, long-term attractiveness, and the return on equity (ROE) profile of the business. This filtering helps to determine the most promising companies forming part of the investible universe.
Investible Universe:
From the relevant universe, an investible universe is created by assessing past and future fundamental variables such as revenue and EBITDA growth, cash flow conversion efficiency, and core ROE. Additionally, qualitative aspects like management capabilities, governance standards, and competitive positioning are evaluated. A thorough valuation exercise, using parameters like P/E, P/B, EV/EBITDA, and DCF, determines an acceptable valuation range for investment.
Portfolio Construction:
The Fund Manager managing the strategy then constructs the Client's Portfolio from within the investible universe at his discretion.
2. Diversified Portfolio:
We aim to create a well-diversified portfolio to mitigate risk while maximizing returns. The portfolio generally consists of upto 25 stocks and is a mix of large-cap, mid-cap, and small-cap stocks across various sectors. This diversification helps in spreading risk and capturing growth opportunities across different segments of the market.
3. Active Management:
The strategy is actively managed under the leadership of Alok Agarwal, the Fund Manager, along with a team of experienced professionals. This active management approach allows the strategy to respond quickly to market changes and take advantage of emerging opportunities. The fund manager monitors the portfolio and makes adjustments as needed to optimize performance.
4. Experienced Team:
With our experienced team of investment professionals, there is a strong emphasis on compliance and risk management. Alchemy Capital Management has earned the trust of institutional investors, sovereign funds, ultra-high-net-worth individuals (HNIs), and family offices.
5. Long-Term Focus:
Alchemy High Growth emphasizes on a long-term investment horizon of 3 to 5 years. The investment approach is associated with high risk, reflective of the focus on equities. The portfolio can allocate up to 100% in equities, with any cash portion potentially deployed in liquid funds or debt securities. A typical portfolio may consist of a maximum of 25 stocks across various sectors.
Investment Philosophy Approach
The investment philosophy is centered around long-term capital appreciation through strategic investments in high-growth stocks. Here’s a closer look at the strategy’s approach:
1. Growth at a Reasonable Price:
Alchemy’s investment philosophy is "Growth at Reasonable Price" (GARP). Recognizing India's high-growth economy and strong entrepreneurial culture, the firm aims to identify and invest in growth companies that are poised to capitalize on these dynamics. The strategy combines top-down and bottom-up fundamental research to pinpoint companies with significant long-term wealth creation potential.
Performance Metrics & Track Record
Alchemy High Growth PMS strategy has demonstrated exceptional performance metrics, reflecting its robust investment strategy and effective management. A compelling illustration of the strategy's growth potential is the hypothetical investment of INR 1 crore in May 2002, which could have grown to over INR ~81.5 crores^#. This growth trajectory showcases the strategy’s ability and aims to deliver substantial returns over the long term, significantly enhancing investor wealth.
Furthermore, the strategy has generated a net annualized alpha of +377 basis points (bps)* in INR approx 82 crores (*Data as of August 31, 2024). These metrics not only reflect the strategy’s performance but also its resilience and adaptability in various market conditions, making it a preferred choice for investors seeking high-growth opportunities with effective risk management.
Periodic Returns
1M | 3M | 6M | 1Y | 3Y | 5Y | 10Y | Since Inception | |
Portfolio Returns# | 8.6% | -13.1% | -0.1% | 36.9% | 12.6% | 12.4% | 11.4% | 21.1% |
BSE 500 TRI** Returns | -6.4% | -3.6% | 8.7% | 35.9% | 15.7% | 19.8% | 14.3% | 17.5% |
Data as of October 31, 2024 | *Inception Date: May 08, 2002
** The benchmark performance is calculated using the composite CAGR of BSE 500 PRI values from May 08, 2002, to August 01, 2006, and TRI values since August 01, 2006, as the TRI data of BSE 500 is not available.
# Performance-related information provided herein is not verified by SEBI | Returns are net of fees, expenses, and taxes (if applicable). | Returns less than 365 days: Absolute, greater than 365 days: CAGR ( Computed using TWRR method). | Past Performance is not indicative of future performance. | The above performance figures are an aggregate of all discretionary clients; the investor's actual portfolio may differ. | Please refer to the link for viewing Performance relative to other portfolio managers: https://www.apmiindia.org/apmi/welcomeiaperformance.htm?action=PMSmenu
Alchemy High Growth stands out as a compelling investment option for those looking to maximize returns through strategic investments in high-growth stocks. With a robust investment philosophy, long track record, and focus on future growth opportunities, the strategy consistently aims to deliver superior returns.
By leveraging its research-driven approach and active management, Alchemy Capital Management continues to identify and capitalize on high-growth opportunities, providing investors with an attractive avenue for long-term capital appreciation.
Its adaptive strategy and focus on high-growth stocks position it well to navigate future market trends and deliver exceptional returns.
To learn more about our Alchemy High Growth, kindly connect with our team today https://www.alchemycapital.com/portfolio-management-services/alchemy-high-growth.aspx#footer.
Disclaimer:
Alchemy High Growth is one of the Portfolio Management Services products managed by M/s Alchemy Capital Management Pvt Ltd, a SEBI registered Portfolio Manager vide registration number INP000000365.
This blog is for informational purposes only and should not be considered as an offer or solicitation to buy or sell any securities or make any investments. We recommend readers to take independent advice before taking any investment decisions. Please refer to our Disclaimer and Disclosures for more details.
For complete details of the Product, please contact us for the Disclosure Document / Offer Document.