Value Strategy May 2020

Investment Objective
Value strategy aims to benefit from the long term compounding effect on investments done in good businesses, run by great
business managers for superior wealth creation

Key Features
1. Large cap oriented portfolio with ~69% weightage
2. 16+ years track record with annualized return of 20.4% since inception (an alpha of 6.2% over Nifty 50)
3. Concentrated portfolio of 22 stocks with high earnings growth
4. Each of the portfolio companies are market leaders in their respective segments
Portfolio Attributes
1. Index agnostic: ~63% away from benchmark Nifty 50
2. The portfolio delivered returns of ~21.5% in CY19- an alpha of ~9.5% over Nifty 50 for the same period
3. Value Strategy has outperformed Nifty 50 by ~7.5% in the 1 year period trailing 30th April 2020

Portfolio Actions in last 6 months

• Companies Added: GlaxoSmithKline Pharma, LIC Housing Finance, Bharti Airtel
• Companies Exited: ICICI Lombard General Insurance, Tech Mahindra, Bharat Forge

How Buy Right : Sit Tight works

Initial Market Cap Market Cap

Absolute
Company Purchase Rs. Crores Rs. Crores CAGR (%) Wealth creation
Growth
Date (Purchase Date) (30th Apr 20) is achieved
through holding
HDFC Bank Jul-08 40,986 5,49,381 13.4X 25% quality
HDFC Life Insurance companies for a
Nov-17 69,229 1,01,152 1.5X 17% long period of
Company
time
Ipca Laboratories May-18 9,239 20,453 2.2X 49%

Top 10 Holdings & Sectoral Allocation

Scrip Names % Holding Banks 32.5

Other Services 21.5

HDFC Bank 10.9

Max Financial Services 10.7 Pharmaceuticals 13.9

ICICI Bank 9.8 Auto & Auto Ancillaries 7.4

HDFC Life Insurance Company 7.6 Oil and Gas 6.9

Kotak Mahindra Bank 7.0
Engineering & Electricals 6.3
Ipca Laboratories 5.7
FMCG 3.2
Dr Reddy's Laboratories 5.6
Telecom 2.8
Bharat Petroleum Corporation 4.3
NBFC 2.3
Larsen & Toubro 4.2

Maruti Suzuki India 3.5 Services 0.6

Disclaimers and Risk Factors

Value Strategy Inception Date: 25th Mar 2003; Data as on 30th April 2020; Data Source: MOAMC Internal Research; RFR: 7.25%; *Earnings as of December 2019 quarter and market price as on 30th April 2020;
Source: Bloomberg consensus, Capitaline and Internal Analysis; Please Note: The above strategy returns are of a Model Client as on 30th April 2020. Returns of individual clients may differ depending on time of
entry in the Strategy. Past performance may or may not be sustained in future and should not be used as a basis for comparison with other investments. Returns below 1 year are absolute and above 1 year are
annualized. Strategy returns shown above are post fees & expenses. The stocks forming part of the existing portfolio under Value Strategy may or may not be bought for new client. Name of the PMS Strategy does
not in any manner indicate its future prospects and returns. The Company names mentioned above is only for the purpose of explaining the concept and should not be construed as recommendations from MOAMC.
Value Strategy May 2020
Performance Since Inception
400 23.9X
Value Strategy Nifty 50
Value Strategy has
300 delivered a CAGR of
200 20.4% vs. Nifty 50
9.7X
returns of 14.2%, an
100 outperformance of 6.2%
0 (CAGR) since inception
(25th March 2003)

Mar-15

Mar-16
Mar-03

Mar-04

Mar-05

Mar-06

Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Mar-12

Mar-13

Mar-14

Mar-17

Mar-18

Mar-19

Mar-20
Value Strategy Nifty 50
20.4
14.4 14.2
10.9 9.4 11.6
5.0 5.9 3.4 3.8 7.5 6.5
0.5 2.0

-5.0 -4.2
-8.4
-16.1
1 Year 2 Years 3 Years 4 Years 5 Years 7 Years 10 Years 15 Years Since
Inception

Fund Contributors (1 Year Trailing 30th April 2020) Ageing

Top 5 Contribution Number of Scrips Holding Period
2 > 10 Years
Ipca Laboratories 2.4%
1 > 5 Years but < 10 Years
HDFC Life Insurance Company 2.3% 9 > 2 Years but < 5 Years
10 < 2 Years
Dr Reddy's Laboratories 1.4%
The average holding period for stocks held under Value
Max Financial Services 1.0% Strategy is about 3 years and 1 month
*The Portfolio has been repositioned towards high
ICICI Lombard General Insurance Company 0.5% growth companies over the past 2.5 years: 14 stocks have
been bought into the portfolio since November 2017

Bottom 5 Contribution Market Capitalization

HDFC Bank -1.4% 3.0%
25.6% Large Cap
Bajaj Finserv -1.4%
Mid Cap
Quess Corp -1.5%

Bharat Forge -1.5% Small Cap

68.8%
Larsen & Toubro -1.8% Weighted Average Market Cap Rs. 1,54,920 Crs

*Portfolio Fundamentals Risk Ratios

TTM FY20E FY21E 3 Year Data Strategy Benchmark

Churn Ratio 29.4% -
PAT Growth 48% 35% 29%
Standard Deviation 19.3% 19.6%
RoE 15% 14% 16% Beta 0.8 1.0
PE 31 28 22 Sharpe Ratio -2.2 -1.3

Disclaimers and Risk Factors

Value Strategy Inception Date: 25th Mar 2003; Data as on 30th April 2020; Data Source: MOAMC Internal Research; RFR: 7.25%; *Earnings as of December 2019 quarter and market price as on 30th April 2020;
Source: Bloomberg consensus, Capitaline and Internal Analysis; Please Note: The above strategy returns are of a Model Client as on 30th April 2020. Returns of individual clients may differ depending on time of
entry in the Strategy. Past performance may or may not be sustained in future and should not be used as a basis for comparison with other investments. Returns below 1 year are absolute and above 1 year are
annualized. Strategy returns shown above are post fees & expenses. The stocks forming part of the existing portfolio under Value Strategy may or may not be bought for new client. Name of the PMS Strategy does
not in any manner indicate its future prospects and returns. The Company names mentioned above is only for the purpose of explaining the concept and should not be construed as recommendations from MOAMC.