Tata Focused Equity Fund This product is suitable for investors who are seeking*: * Investors should consult their financial advisors if in doubt about whether the product is suitable for them. • Long Term Capital Appreciation. • Investment in equity & equity related instruments in a concentrated portfolio of maximum 30 stocks across market capitalisation. th NFO CLOSES : 29 NOVEMBER, 2019 th NFO OPENS : 15 NOVEMBER, 2019 FOCUSED EQUITY FUND (An Open Ended Equity Scheme investing in maximum 30 stocks across market caps (i.e. Multi Cap))
2 “Wide diversifica�on is only required when investors do not understand what they are doing" “Diversifica�on may preserve wealth, but concentra�on builds wealth" WARREN BUFFETT
3 TATA FOCUSED EQUITY FUND – SELECT RIGHT, SWING HARD
MORE DIVERSIFICATION ≠ MORE RETURNS • Investments in Tata Focused Equity Fund will not be restricted to stocks of Ni�y 50 Index. • Data as of 30th Sep'19. • Illustra�on given here is to explain the concept of Focused Funds. 4 Observing the Ni�y 50 stocks, every addi�onal set of stocks contributes less to the por�olio returns.
PORTFOLIO CONCENTRATION AND RISK • performance of stocks. *Calcula�on for Illustra�ve purpose. A focused fund can be constructed with upto 30 stocks. A combina�on of scenarios can be arrived at basis individual 1) Downside risk of a majority of stocks underperforming and adversely impac�ng por�olio returns. FEW RIGHT CALLS CAN MAKE ALL THE DIFFERENCE ranging stock performances A highly concentrated por�olio with wide others 5 compensates for underperformance of Excep�onal performance of a few stocks • por�olio Resul�ng in decent overall returns for the • 2) Upside opportunity with a majority stocks outperforming and li�ing por�olio returns further
STOCK PICKING MAKES ALL THE DIFFERENCE • Data is only for illustra�on purposes. • Performance �ll Sep’19 • Sectors men�oned may or may not form part of actual por�olio of Tata Focused Equity Fund 6 Dispersion between the top and bo�om performers Rs 100 invested in banking stocks 10 years back could have given returns in the range of Rs 36 to Rs 1,111 BANKING Returns for consumer stocks could have either resulted in gains of Rs 1103 or just Rs 10 CONSUMER GOODS
7 “All I want to know is where I'm going to die so I'll never go there” CHARLIE MUNGER
SUCCCESSFUL INVESTMENT IS KNOWING WHAT TO AVOID *Returns �ll 15th Oct’19 8
9 Wealth crea�on is a func�on of Selec�on & Alloca�on Fewer Stocks, Greater Focus Select Right, Swing Hard Bet on sustainable businesses with long runways for growth INTRODUCING FOCUSED EQUITY FUND (An Open Ended Equity Scheme investing in maximum 30 stocks across market caps (i.e. Multi Cap))
TATA FOCUSED EQUITY FUND – TAKES THE BLUR OUT *each investment decision to be in conformity with the por�olio characteris�cs/process men�oned in the SID 10
11 Proportion of mid Business fundamentals and valuations to be primary driver of stock selection MARKET CAP AGNOSTIC • cap/small cap to be to investing governed by the relative risk reward opportunity. • Risk management framework to act as a guard rail • No specific market cap • Bottom up approach TATA FOCUSED EQUITY FUND – STOCK SELECTION *each investment decision to be in conformity with the por�olio characteris�cs/process men�oned in the SID COMPOUNDING STOCKS • Efficient Capital Management • Companies with a • long runway for growth • Ability to grow earnings sustainably • Management quality SECTOR AGNOSTIC tilt
12 • stock selection and driven by bottom up Portfolio construction • up invested as they scale growth and remain with long runway for Look for businesses • predominant approach Buy and hold capped at 30. TATA FOCUSED EQUITY FUND stocks in the portfolio Upper limit of no. of • conviction Fund Manager’s Portfolio to reflect • ACTIVE POSITIONS LOW CHURN CONCENTRATED *each investment decision to be in conformity with the por�olio characteris�cs/process men�oned in the SID – PORTFOLIO CONSTRUCTION not by the benchmark
GROWTH AT REASONABLE PRICE - GARP discount Change in sector • Macro tailwinds • Thema�c Value with triggers improving outlook In early stages of • t mul�-year valua�on 13 A • Upgrade cycle earning upgrades Valua�on re-ra�ng + • consensus Upgrade cycle vs. • dynamics
INVESTMENT FRAMEWORK • Promoter pledges • Working capital prac�ces • Historical ROCE trend • Success rate and adjacency in diversifica�ons, if any • Capital intensity of the business • Dividend payout history • Board composi�on and • Number of dilu�ons in the compensa�on • Related party transac�ons • Promoter’s other interests and funding • FCF genera�on • Valua�on risk-reward framework based on • Earnings sensi�vity past and peak debt levels business cycles 14 • Compe��ve advantage + • What point of the cycle – early stage vs. mid/late cyclicals • ROE and FCF expansion • Growth (how we define it) – 15%+ CAGR over 3 years Industry runway and structure management execu�on • Capital alloca�on across track record • Cyclical tailwinds (if any) • Quality of growth • Average daily trading volumes • Risk parameters based on limits on liquidity coverage • Par�cipa�on rates • Long term valua�on range
RISK MANAGEMENT • Sufficient cash levels to be sectors by dedicated • Stocks analysed across universe of stocks • Out of an approved churn requirements redemp�on and por�olio maintained to meet management guidelines 15 • As per internal risk stock limited at 10%* • Maximum alloca�on to a and stock liquidity risk reward opportunity • To be governed by rela�ve • No deliberate cash calls *Not accoun�ng for passive breaches analyst team
MEET THE FUND MANAGER • head of Corporate and Infrastructure Ra�ngs group at CARE Ra�ngs. Advisors Private Limited on the boards of investee companies. He has also worked as Limited in their investments team and held directorships to represent Indiareit Fund Prior to joining Tata Asset Management, he worked with Indiareit Fund Advisors Private Sharia Scheme Tax Savings Fund, Tata Infrastructure Fund and Tata Ethical Fund & Tata Offshore India Funds managed by Rupesh – Tata Midcap Growth Fund, Tata Large Cap Fund, Tata India Listed equity investments, Evalua�on of infrastructure projects Rupesh Patel • Private equity real estate investments, • Credit risk assessment and • Rupesh has 19 years+ of experience spread across 16 Tata Asset Management Ltd Senior Fund Manager, He is a graduate in engineering and also MBA from Sardar Patel University, Gujarat
17 Utilities, Cement and holder • Sectors: BFSI • 13+ years experience, PGDM • Sectors: Construction, Capital Goods, Power Logistics • 13+ years experience, • 13+ years experience, PGDM • Sectors: Oil & Gas, Metals & Mining and Chemicals 2000+ company interac�ons in a year MMS, CFA Charter Media, Textile EXPERIENCED TEAM OF • Sectors: IT, Pharma, ASSISTANT FUND MANAGERS & ANALYSTS Meeta She�y Enne�e Fernandes Amey Sathe Abhinav Sharma Sa�sh Mishra Telecom Building Products, • 13+ years experience, CFA Charter holder & Bachelor in Economics • 10+ years experience, PGDBM • Sectors: FMCG, Retail, Consumer Durables, Sector focus – All major sectors covered
FUND DETAILS Exit Load: 1% of the applicable NAV, if redeemed/switched out on or before expiry of 365 Rs. 5,000/- and in mul�ple of Re.1/- therea�er Min. Investment Amount NFO OPENS: 15th November 2019 • NFO CLOSES: 29th November 2019 NFO Dates Rupesh Patel Fund Manager TATA FOCUSED EQUITY FUND Scheme Name S&P BSE 200 TRI Benchmark days from the date of allotment. inves�ng in equity & equity related instruments of maximum 30 stocks across market caps. The investment objec�ve of the scheme is to generate long term capital apprecia�on by Investment Objec�ve mul�cap). An Open Ended Equity Scheme inves�ng in maximum 30 stocks across market caps (i.e. Type of Scheme will be achieved. The scheme does not assure or guarantee any returns. However, there is no assurance or guarantee that the investment objec�ve of the Scheme Entry Load (During NFO): N.A. Load Structure Addi�onal Investment: Rs 1,000/- and in mul�ple of Re 1/- therea�er. 18
DISCLAIMER 19 Mutual Fund Investments are subject to market risks, read all scheme related documents carefully Tata Focused Equity Fund is suitable for investors who are seeking*: • Long Term Capital Appreciation. • Investment in equity & equity related instruments in a concentrated portfolio of maximum 30 stocks across market capitalisation. * Investors should consult their financial advisors if in doubt about whether the product is suitable for them.
Thank You Call: 022 - 6282 7777 (Monday to Saturday 9:00 am to 5:30 pm) www.tatamutualfund.com
Recommend
More recommend
