Abakkus All Cap Approach

PMS Strategy August 2021

The markets were generally flat for the month of July, with the Covid Update
Nifty 50 barely ending in the green. However, as has been the
On the covid front, the focus globally is on the pace of the
recent trend, the broader markets did much better. Buoyed
vaccination and efficacy. India's total dose count crossed
by institutional as well as retail interest, the S&P BSE Midcap
~450mn in July, of which ~98mn (~10% of adult population)
ended up ~3% while the S&P BSE 250 Smallcap index recorded
were administered both doses. As per an interesting report, as
a healthy ~8% gain. Amongst sectors, metals and real estate
of July 19, 2021, almost 50% of US population has been fully
were the best performing while autos & power lost the most.
vaccinated and this has markedly curbed the pandemic
While markets ended flat, it was a volatile month, where
there. If there had been no Covid-19 vaccination program,
investors were tested on negative print from higher inflation
daily deaths from Covid-19 would have created a second
numbers, worry over the delta variant of covid and sell-off in
wave (a “spring surge”) - of nearly 4,500 deaths per day -
Chinese technology stocks.
potentially larger than the first wave of the year, which peaked
On the global front, benchmark indices in Hong Kong and at 4,000 deaths per day in January. Most of the additional
Shanghai were down as Chinese tech and education stocks deaths during the second 2021 wave (the shaded area of the
plunged sharply on regulatory steps. US markets rose 2% led by Exhibit 2) would have occurred because of an increase and
strong corporate results. Among other developments, Fed spread of the more transmissible Alpha variant, proving the
kept interest rates unchanged at their near-zero level, nor did efficacy of vaccines clearly.
it announce when it planned to let up on its $120 billion in
monthly bond purchases. Nevertheless, with inflation soaring
Exhibit 1: % of Population Vaccinates
quickly and some employment measurements finally starting
Indonesia 16
to show sustained improvement, it did hint at considering such
UK 68
a move in the future. ECB kept its key interest rates France 57
unchanged, while OPEC+ agreed to gradually increase oil US 56
Russia 23
supply over Aug-Dec 2021. Amidst rising commodity prices,
South Africa 9
China raised export tariffs on steel products. Philippines 10
India 24
Foreign Portfolio Investments (FPIs) sold a good ~USD 1.3 bn Italy 61
worth of Indian equities. However, Domestic Institutional Germany 60
Investors (DIIs) bought ~USD 2.1 bn worth of equities, negating Thailand 17
Mexico 31
the FPI selling. The Consumer Price Index (CPI) eased
Brazil 46
marginally to 6.26% in June 2021 from 6.3% in May 2021. The
0 20 40 60 80 100
Wholesale Price Index (WPI) of India eased from last month's
Fully Vaccinated Partially Vaccinated
record high as it rose 12.07% in June 2021. Index of Industrial
Source: CEIC, Axis Capital, https://ourworldindata.org/covid-vaccinations
Production (IIP) in India rose 29.3% year-on-year in May of 2021,
below market expectations of 32% as regional lockdowns in
most states to contain the second wave of the coronavirus Exhibit 2: Estimated U.S. Seven-day rolling average
pandemic hurt activities. of daily with and without vaccination
4500
4000
Gross tax revenue collections continue to beat government's
3500
budget expectations. Data suggests that gross tax revenues in 3000
Daily Deaths

1QFY22 are up 97%, while expenditure growth is weak in 2500

1QFY22 (0.7% increase) suggesting fiscal position is well 2000
managed. Fiscal deficit in 1QFY22 came in at just 18% of the 1500

full-year target, significantly lower than pre-Covid trend for the 1000
500
first quarter at ~60% of full fiscal year. Interestingly, Capital
0
Expenditure trended in much higher reporting at 26% growth.
Oct 1’20

Nov 1’20

Dec 1’20

Jan 1’21

Feb 1’21

Mar 1’21

Apr 1’21

May 1’21

Jun 1’21

Jul 1’21

Elsewhere, total Goods & Services Tax (GST) collections yet

again surprised on the upside at ~INR 1.16tn (~USD 16 bn) for
June 21 (~INR 928 bn i.e. ~USD 13 bn for May and ~INR 1,027 bn Vaccination Without Vaccination

i.e. ~USD 14 bn for April). Source: https://www.commonwealthfund.org

Source*: NSDL, PTI, ANI, Bloomberg, BSE

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Abakkus All Cap Approach

PMS Strategy August 2021

Earnings & Valuations
Q1FY22 quarterly results reported so far have been decent. IT /
Commodities largely beat expectations while Financials /
Autos / Pharma missed on account of margin pressure as we
have been fearing. We continue to monitor the earnings
season closely. Going forward, it will be critical to see demand
continuing to recover as restrictions related to covid ease.
Progress of monsoon which is so far normal would also be
important to gauge the continued momentum in rural
demand.
Market Outlook
Markets have been pretty strong, with the broader markets
leading the way. Though earnings have kept pace in most
cases, pockets of over enthusiasm are beginning to be seen.
Primary markets are in a euphoric zone, with every listing
reporting 50%-100% gains on listing. This has led to record over-
subscriptions in most Initial Public Offerings (IPOs). The listing of
India's first “start-up” so to say, is a welcome development as it
brings in new category of investors, though valuations will
always be a topic of debate. More such IPOs are expected in
the near future. Although our view continues to remain
positive over the long term, investors should expect
intermittent sharp volatility in the markets. Careful discretion is
advised as also staying away from 'tip-based” short-term
investing.
Portfolio Update
It was again a very strong month for the portfolio in July,
gaining ~9% for the month vs flattish headline indices and
handsomely outperforming all major indices. Portfolio
continues to be largely deployed at 90%+ levels and there has
not been any significant churn in the portfolio. During the
month we have made a new investment in a large efficient
east India based utility company for our new clients. Result
season for portfolio companies have been encouraging and
in line with our estimates.

Top 10 holdings#
Jindal Stainless Hisar Limited ICICI Bank Limited

BSE Limited Oracle Financial Services Software Limited

Mastek Limited State Bank of India Limited

DCM Shriram Limited UPL Limited

Max Financial Services Limited HCL Technologies Limited
st
#All data as of 31 July 2021. The portfolio is currently in buildup stage. The current portfolio holdings may or may not be a part of the future
portfolio Holdings and may or may not be a part of all client portfolios.

Disclaimer: #Individual Companies/Stocks discussed are for discussion purposes or making a point about economy only and are not recommendations to invest and may/may not be part of our
Fund's current/future holdings The financial data presented above are collated on best effort basis from various source like ACE Equity, NSE, BSE, Company Data,Abakkus Estimates etc with
adjustments. While the manager has taken appropriate care for the accuracy of the same. The investor should refer to the detailed Financial information of the investee companies from the
respective company's website as well as from BSE and/or NSE website

PMS Performance as on 31st July 2021*

Period 1 Month (%) 3 Months (%) 6 Months (%) Since Inception^ (%)

Abakkus All Cap Approach 8.7 25.7 55.5 78.2

S&P BSE 200 0.8 9.2 18.8 39.4

NIFTY 50 0.4 7.8 15.7 34.5

S&P BSE MIDCAP 2.5 13.7 27.7 55.9

^ Gradual deployement during initial stage of the strategy. Data in INR Terms.
* Performance data for Portfolio Manager and Investment Approach provided hereunder is not verified by any regulatory authority and Past performance may or may not sustain in the future.
The Approach level performance is based on TWRR as per SEBI guidelines as on 31st July 2021, inception date being 29th October 2020, net of all expenses and investor returns may differ, based on
their period of investment, fee structure and point of capital flows.

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Abakkus All Cap Approach

PMS Strategy August 2021

PMS Characteristics

Benchmark agnostic diversified All cap portfolio

Fundamental based ideas picked via a bottom up approach
Large cap allocation based on top-down sector view with focus on stability
Alpha from exposure to broader market companies with sustainable business and high ROEs
Endeavor to generate alpha and wealth creation by buying with typically 3-5 years holding period
Differentiated Portfolio adhering to our “MEETS” Framework
Note : For more details relating to this approach such as Investment Objective, details of securities, basis of selection/Allocation/Time Horizon/Fees/Expenses and Risk associated with the
Investments, Kindly refer to latest disclosure at our website https://abakkusinvest.com/disclosures.

PMS Features

Investment Approach Abakkus All Cap Approach

Capital Contribution INR 50 Lakh and above

Benchmark S&P BSE 200

Fund Manager Sunil Singhania / Aman Chowhan

Custody & Fund Accounting HDFC Bank Ltd.

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Abakkus All Cap Approach

PMS Strategy August 2021

Other Disclosures and Disclaimers

This document is confidential and is intended only for the personal use of the prospective investors to whom it is addressed or delivered and must
not be reproduced or redistributed in any form to any other person without prior written consent of Abakkus Asset Manager LLP (“Portfolio
Manager”). This document does not purport to be all-inclusive nor does it contain all of the information which a prospective investor may desire.
Abakkus Asset Manager LLP is registered portfolio manager with SEBI under registration number: INP000006457 dated 14-03-2019.
This document is neither a general offer nor solicitation to invest with Abakkus All Cap Approach (“Approach”) nor is it an offer to sell or a generally
solicit an offer to become an investor in the Portfolio. The delivery of this document at any time does not imply that information herein is correct as
of any time subsequent to its date. The contents of this document are provisional and may be subject to change. In the preparation of the
material contained in this document, the Portfolio Manager has used information that is publicly available, certain research reports including
information developed in-house. The Portfolio Manager warrants that the contents of this document are true to the best of its knowledge,
however assume no liability for the relevance, accuracy or completeness of the contents herein.
The Portfolio Manager has no previous experience/track record in the field of portfolio management services, however the Principal Officer and
other key management personal of the portfolio manager have reach individual experience.
The Portfolio Manager (including its affiliates) and any of its directors, officers, employees and other personnel will not accept any liability, loss,
damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way
arising from the use of this document in any manner whatsoever.
This document may include certain statements which contain words or phrases such as “believe”, “expect”, “anticipate”, “estimate”, “intend”,
“plan”, “objective”, “goal”, “project”, "endeavor" and similar expressions or variations of such expressions that are forward-looking statements.
Actual results may differ materially from those suggested by the forward-looking statements due to risks, uncertainties or assumptions.
This document cannot be copied, reproduced, in whole or in part or otherwise distributed without prior written approval of the Portfolio Manager.
The Portfolio Manager (including its affiliates) may offer services in nature of advisory, consultancy, sponsorship of funds, investment management
of funds including category III AIF under SEBI registration number IN/AIF3/18-19/0550 for Abakkus Growth Fund and all its schemes, etc., which may
be in conflict with the activities of portfolio management services.
The Portfolio Manager endeavors to invest in a multicap portfolio with some exposure to large cap and larger midcaps which are appropriately
represented by the S&P BSE 200 index.
Prospective investors are advised to review this document, Disclosure document, PMS agreement, presentation(s) and other related documents
carefully and in its entirety. Prospective investors should make an independent assessment, and consult their own counsel, business/investment
advisor and tax advisor as to legal, business and tax related matters concerning this document, the PMS Agreement, Disclosure document and
the other related documents before becoming invested in the Approach.
Tenure or investment horizon of typically investments will have a medium to long term time horizon of 3-5 years. The Portfolio Manager may, at its
discretion if it deems fit, hold any Portfolio Investment beyond 5 years, but the same shall not be beyond the Term of the Agreement. The risks
disclosed may affect portfolio performance even though the Portfolio Manager may take measures to mitigate the same.
The information contained in this document has been prepared for general guidance and does not constitute a professional advice and no
person should act upon any information contained herein without obtaining specific professional advice. Neither the Portfolio Manager nor its
Affiliates or advisors would be held responsible for any reliance placed on the content of this document or for any decision based on it. Each
existing / prospective investor, by accepting delivery of this document agrees to the foregoing. The business proposed to be carried out by the
Investment Approach are subject to several risk factors including but not limited to political, legal, social, economic and overall market risks.
Recipient should consult their own investment advisors/consultants to evaluate the risk/rewards and suitability of the said products based on their
own risk profiling for any decisions. The recipient alone shall be fully responsible/are liable for any decision taken on the basis of this document.
The factsheet is for information purpose only not to be used for any other purpose and is not a solicitation, offer or enticement for business or
investment into the said product. Individuals should consult their own investment advisors/consultants to evaluate the risk/rewards and suitability
of the said products based on their own risk profiling for any decisions.
CIN: AAM-2364 PMS SEBI Reg.: INP000006457 AIF SEBI Reg.: IN/AIF3/18-19/0550
Corporate Investment Adviser Registration no. INA000015729

Contact us
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Write to us at abakkus@camsonline.com or call at +91 44 61092415 or +91 44 28432215
Abakkus Asset Manager LLP
Abakkus Corporate Center, 6th Floor, Param House, Shanti Nagar, Near Grand Hyatt, Off Santacruz Chembur Link Road, Santacruz East,
Mumbai - 400055. India. Ph: +91 22 68846600 info@abakkusinvest.com

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