Consistent Compounders

How Will Tight System Liquidity Impact KCP?

Given consistently strong credit demand and weak deposit growth, we are now staring at a tough funding environment with banking sector credit to deposit ratio at an all-time high of ~80%. This funding environment along with consistent regulatory action will separate the men from the boys in the upcoming quarters leading to divergent growth outcomes […]

Apr 08 . 8 MIN READ
Consistent Compounders

Portfolio performance and update on Fundamentals

*For relative performance of particular Investment Approach to other Portfolio Managers within the selected strategy, please refer https://www.apmiindia.org/apmi/WSIAConsolidateReport.htm?action=showReportMenu Under PMS Provider Name please select Marcellus Investment Managers Private Limited and select your Investment Approach Name for viewing the stated disclosure   Consistent Compounders Portfolio (CCP) In our recent CCP newsletter (click here ) we highlighted that long periods of […]

Mar 21 . 7 MIN READ
Consistent Compounders

Rich rewards from Investing in Quality during the Toughest Phase

Long periods of outperformance by quality firms are often characterized by intermittent periods of severe underperformance – something that has been unavoidable by even the likes of Warren Buffet. Such underperformance was especially prominent during three instances (first half of 1970s, Mar’99-Aug’00 & Nov’04-Apr’06) wherein Berkshire Hathaway’s underperformance was in high double digits even as […]

Mar 08 . 9 MIN READ
Consistent Compounders

Spotlighting Rainbow Children’s Medicare

In this month’s Little Champs newsletter, we delve deeper into Rainbow Children’s Medicare (Rainbow), one of the new additions to the portfolio. Rainbow, founded in Hyderabad in 1999 by Dr Ramesh Kancharla, focusses only on pediatric and maternity care. The Company stands head & shoulders above its like-to-like peers on profitability and growth metrics and […]

Feb 27 . 10 MIN READ
Consistent Compounders

Rebalancing and the Value Effect

In this newsletter, we quantify the contribution of rebalancing to overall returns by breaking down the portfolio returns into sub-components. We find that periodic rebalancing drives most of the returns of systematic relative value strategies. Selecting quality, undervalued companies, as we do in MeritorQ’s selection step, is effective only when the portfolio is regularly rebalanced. […]

Feb 21 . 7 MIN READ
Consistent Compounders

Marcellus Portfolio Snapshot and Update on Fundamentals – January 2024

  *For relative performance of particular Investment Approach to other Portfolio Managers within the selected strategy, please refer https://www.apmiindia.org/apmi/WSIAConsolidateReport.htm?action=showReportMenu Under PMS Provider Name please select Marcellus Investment Managers Private Limited and select your Investment Approach Name for viewing the stated disclosure   Consistent Compounders Portfolio (CCP) For the quarter ended December 2023 (i.e. 3QFY24), earnings growth of […]

Feb 19 . 8 MIN READ
Consistent Compounders

Global Compounders Portfolio: Resilience Amidst Chaos

Marcellus’ Global Compounders Portfolio (GCP) strategically invests in 25-30 deeply moated global companies aligned with megatrends, fostering a consistent mid to high teens compounding of free cash flow/earnings. Amidst an increasingly uncertain global macro landscape, our proprietary Torque based positioning favors defensive stocks that deliver higher than GDP growth with low earnings volatility – as […]

Feb 12 . 9 MIN READ
Consistent Compounders

Marcellus Portfolio Update and Performance Snapshot – December 2023

  Consistent Compounders Portfolio (CCP) Calendar year 2023 ended with Marcellus’ CCP portfolio generating 16% returns with 6% underperformance against Nifty50 TRI, supported by a recovery in performance from April 2023 onwards (1st Apr 2023 to 31st Dec 2023 performance was 28%, marginally better than Nifty50 TRI). The top-5 stocks in Nifty were Tata Motors, Bajaj Auto, […]

Jan 16 . 15 MIN READ
Consistent Compounders

A Retailer’s Path to Consistent Compounding

Over an extended period of time, it is hard to make money in Retailing. In this newsletter, we discuss a subset of retailing – apparel retailing – and how the principles that underpin the business models of consistent compounders in general are of relevance for success in apparel retailing as well. Two key variables – […]

Jan 06 . 8 MIN READ
Consistent Compounders

Portfolio Performance and Update on Fundamentals

  Consistent Compounders Portfolio (CCP) Companies in our Consistent Compounders Portfolio generated median PAT growth of 24% YoY in 2QFY24 and 27% YoY in 1HFY24. This acceleration in PAT growth is an outcome of both: a) accelerated market share gains and improved operating efficiencies as an outcome of capital allocation decisions taken over the last […]

Dec 18 . 9 MIN READ
Consistent Compounders

Kings of Capital Portfolio Newsletter: Quality lenders to benefit from RBI’s credit shakeout

To curb systemic risk posed by the sharp growth in unsecured credit and NBFC credit in the banking system, the RBI raised risk weights on both from 100% to 125%, effectively asking lenders to set aside more equity capital for these credit risks. This move is likely to have highest impact on business models of […]

Dec 09 . 8 MIN READ
Consistent Compounders

Global Compounders Portfolio: First Anniversary Review

Marcellus’ Global Compounders Portfolio (GCP) strategically invests in 25-30 deeply moated global companies aligned with megatrends, fostering a consistent mid to high teens compounding of free cash flow/earnings. As GCP reaches its first birthday, we reflect on our journey. Despite the brief time span, it’s reassuring to witness the portfolio’s progress aligning with our expectations, […]

Dec 05 . 10 MIN READ

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