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ASK Growth India Fund STP
Fund Snapshot
| Fund Type: | Close-ended, Long-only Category III, Alternative Investment Fund |
| Investment Horizon: | 4.5 years, may be extended up to 2 years with necessary approvals |
| Sponsor & Investment Manager: | ASK Investment Managers Limited |
| Minimum Investment Amount: | Rs 1 Cr and multiples of Rs 1 Lakh after that |
| Final Closing: | Within 12 months from the date of the First Closing |
| Exit Charge: | 5% in Year 1, 4% in Year 2, 3% in Year 3; 1% in Year 4; Nil post Year 4, all from Final Closing. |
Investment Philosophy
ASK Investment Managers’ fundamental concept focuses on two main ideas: first, establish capital protection (over time), then follow it with capital appreciation. We look to make investments in Indian shares that are operated by high-quality management have sustained long-term development potential, and are available at fair and reasonable pricing.
Principles and Overarching Investing Philosophy:
- More assurance of earnings vs. a merely quantitative increase in earnings
- The superior and constant quality of earnings as opposed to just a quantitative increase in earnings
- Superior quality at a fair price as opposed to subpar quality at an artificially low price
The Investment Approach ensures:
- Instead of valuing the price, price the value.
- Investing discipline in excellent companies
- Assembling a portfolio of prospects for compounding
- Purchase “growing” companies for “value” pricing.
The strategy is to purchase high-quality companies at reasonable costs rather than buying subpar companies for a bargain. Additionally, our Key Investment Attributes help design investment strategies to accomplish a certain attribute.
Sectors That Benefit
- Strong Growth Across Multiple Segments of the Economy
- Improving Consumption and Discretionary Spending
- Increasing Manufacturing… and Growing Exports
- Acceleration in Growth in Various Industrial Segments Driven by Govt. Policies
- Better Infrastructure
- Expanding Financing Requirements
- Increasing Digitization
- Low Penetration… Offers Long Runway Ahead
The Vision of Growing India
- Increasing GDP: Bigger the Economy – Bigger the Opportunity
- Likely Acceleration Ahead: GDP per Capita- India at Inflection Point
- With Expanding Addressable Market: Rise in Disposable Incomes
- Large Addition to the Workforce
- The Trillion-Dollar Manufacturing Exports Opportunity for India
- Improving Corporate Profitability to Boost Confidence & Aid Investments
- Government Reforms – Driving Growth
- Massive Growth in Infrastructure Capacity
- PLI Scheme – Fillip to Manufacturing economy
- Globally Competitive Tax Rates
- India Increasingly Attracts More FDI
- Digital India at the Forefront Globally
- Digitization Expanding the Opportunity Universe
Unique Feature
According to Buffett, investing “is straightforward but not easy.” Implementing the basic principles consistently and firmly under all market circumstances is what demands character and makes all the crucial difference. The main benefit comes from performing these simple tasks with consistency and discipline and doing them properly.
Key Investment Objectives
- Capital preservation over a period of time
- Capital appreciation over a period of time
These will be attained through making long-term investments in reputable businesses with promising development potential.
Key Investment Attributes
Size of the Opportunity
- Size of pond v/s size of fish
- Dominance
- Resilience
- Liquidity
Earnings Growth
- Quantum
- Consistency
- Durability
- Predating (early v/s later)
- Compounding power
Quality of Business
- High quality of business (Superior RoCE)
- Strong moat. Impregnability
- Sustainability
- The key pivot of strong wealth creation
Value
- Favorable price-value gap
- Margin of safety
Allocated Sectors
- Consumption: D-Mart, Varun Beverages
- Manufacturing & Exports: SRF, Navin Fluorine
- Industrials: Solar Industries, APL Apollo
- Finance: AU Small Finance Bank, Aavas Financiers
Investment Approach, Research Methodology, and Filtration
- The top 500 according to market capitalization
- During INR 200 billion in profit before taxes (PBT) over the last four quarters
- Subjective assessment of managerial performance (integrity, vision, execution, capital allocation skills, and capital distribution)
- Strict filtering of at least 25%, Minimum of 15%, and Return on Capital Employed (capital efficiency)
- Earnings Growth during the following three to five years
- Finally, a 20–25 business investment strategy that achieves an ideal balance of the overall features, sufficient diversification, and a margin of safety of at least 15% emerged.
