The ‘cult’ of Marcellus propels it to the top of India’s PMS league
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MUMBAI: As Nifty50 tanked 24 per cent in March 2020 amid a raging pandemic, Marcellus Investment Managers’ own funds fell about 15 per cent. At that time, the asset manager’s founder and chief investment officer Saurabh Mukherjea would have felt relieved, and perhaps a hint of pride, at his fund’s resilience.
The relative outperformance of Marcellus Investment Managers during the worst selloff in Indian equity market since the Global Financial Crisis eventually became the catalyst for a blowout year for the PMS.
MUMBAI: While the second wave of Covid-19 may have stalled the rally in equities, shares of companies in the cyclical sectors may come roaring back going ahead as the availability of more vaccines is going to improve the visibility on when the economy can return to normalcy, analysts say.
The government last week allowed fast-track approval for the Covid-19 vaccines of Pfizer, Johnson & Johnson and Moderna under the emergency use authorisation route, which will allow India to accelerate its vaccine drive that has got bogged down in shortages.
The breathtaking rally seen in the cyclical stocks since earlier this year halted in the past few sessions, as investors shifted money to defensive sectors such as pharma and IT. Their concern was that the rapidly spreading virus and vaccine shortage could result in the return of tough lockdowns across states, which would have dented economic and earnings recovery in 2021-22.
Stocks that helped PMSes focused on smallcaps, midcaps outperform in March
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Synopsis
Saurabh Mukherjea, Founder, Marcellus Investment Managers, thinks Indian specialty chemicals today is where the pharma sector stood in the mid-1990s on the cusp of a golden 20-year run.
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Some multicap PMSes, which have larger allocation to midcap and smallcap stocks, also performed well in March, continuing from the earlier months. That was even when their benchmarks finished largely flat for the month.
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NEW DELHI: Smallcap and midcap-focused PMS schemes outperformed their peers by a vast margin for yet another month, as the equity market favoured smaller names vis-à-vis the larger ones in March.
We will carry on buying, we have done so over the last year or so and we will carry on doing so over the next week especially if the correction goes a little deeper, says the founder of Marcellus Investment Managers.
Synopsis
At the end of October 2020, AUM managed by the PMS industry stood at Rs 19.2 lakh crore, up 40% on the October 2017 figure. New PMS providers with high quality fund managers are increasingly visible in the media and in the wealth management industry’s online conferences.
Founder & CIO, Marcellus Investment Managers
Mukherjea is the Founder & CIO of Marcellus Investment Managers (https://marcellus.in/). A London School of Economics alumni, he has over two decades experience in equity research and investment, and has spent much of his career figuring out the length and breadth of the Indian equity market. Someone described him as the missing piece of a sane thought leader in Indian equities. Mukherjea is author of the widely acclaimed book. Coffee Can Investing: The low risk route to stupendous wealth, besides two others The Unusual Billionaires and Gurus of Chaos. His newsletters on Indian markets and investment practices are most widely read.