Tata Focused Equity Fund This product is suitable for investors who - - PowerPoint PPT Presentation

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Tata Focused Equity Fund This product is suitable for investors who - - PowerPoint PPT Presentation

Oct 23, 2023 110 likes •332 views

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

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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.

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NFO CLOSES : 29 NOVEMBER, 2019

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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))

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“Wide diversificaon is only required when investors do not understand what they are doing" “Diversificaon may preserve wealth, but concentraon builds wealth"

WARREN BUFFETT

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TATA FOCUSED EQUITY FUND

– SELECT RIGHT, SWING HARD

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MORE DIVERSIFICATION ≠ MORE RETURNS

  • Investments in Tata Focused Equity Fund will not be restricted to stocks of Niy 50 Index.
  • Data as of 30th Sep'19.
  • Illustraon given here is to explain the concept of Focused Funds.

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Observing the Niy 50 stocks, every addional set of stocks contributes less to the porolio returns.

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SLIDE 5

PORTFOLIO CONCENTRATION AND RISK

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  • Resulng in decent overall returns for the

porolio

  • Exceponal performance of a few stocks

compensates for underperformance of

  • thers
  • A highly concentrated porolio with wide

ranging stock performances FEW RIGHT CALLS CAN MAKE ALL THE DIFFERENCE

1) Downside risk of a majority of stocks underperforming and adversely impacng porolio returns. *Calculaon for Illustrave purpose. A focused fund can be constructed with upto 30 stocks. A combinaon of scenarios can be arrived at basis individual performance of stocks. 2) Upside opportunity with a majority stocks outperforming and liing porolio returns further

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SLIDE 6

STOCK PICKING MAKES ALL THE DIFFERENCE

  • Data is only for illustraon purposes.
  • Performance ll Sep’19
  • Sectors menoned may or may not form part of actual porolio of Tata Focused Equity Fund

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Dispersion between the top and boom 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

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“All I want to know is where I'm going to die so I'll never go there”

CHARLIE MUNGER

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SLIDE 8

SUCCCESSFUL INVESTMENT IS KNOWING WHAT TO AVOID

*Returns ll 15th Oct’19

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SLIDE 9

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Wealth creaon is a funcon of Selecon & Allocaon 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))

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TATA FOCUSED EQUITY FUND

– TAKES THE BLUR OUT

*each investment decision to be in conformity with the porolio characteriscs/process menoned in the SID

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TATA FOCUSED EQUITY FUND

– STOCK SELECTION

*each investment decision to be in conformity with the porolio characteriscs/process menoned in the SID

COMPOUNDING STOCKS

  • Efficient Capital

Management

  • Companies with a

long runway for growth

  • Ability to grow

earnings sustainably

  • Management quality

SECTOR AGNOSTIC

  • Bottom up approach

to investing

  • Business

fundamentals and valuations to be primary driver of stock selection

MARKET CAP AGNOSTIC

  • Proportion of mid

cap/small cap to be governed by the relative risk reward opportunity.

  • Risk management

framework to act as a guard rail

  • No specific market cap

tilt

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TATA FOCUSED EQUITY FUND

– PORTFOLIO CONSTRUCTION

*each investment decision to be in conformity with the porolio characteriscs/process menoned in the SID

CONCENTRATED LOW CHURN ACTIVE POSITIONS

  • Portfolio to reflect

Fund Manager’s conviction

  • Upper limit of no. of

stocks in the portfolio capped at 30.

  • Buy and hold

predominant approach

  • Look for businesses

with long runway for growth and remain invested as they scale up

  • Portfolio construction

driven by bottom up stock selection and not by the benchmark

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GROWTH AT REASONABLE PRICE - GARP

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  • Upgrade cycle vs.

consensus

  • Valuaon re-rang +

earning upgrades

Upgrade cycle

  • A

t mul-year valuaon discount

  • In early stages of

improving outlook

Value with triggers Themac

  • Macro tailwinds
  • Change in sector

dynamics

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SLIDE 14

INVESTMENT FRAMEWORK

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  • 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

  • Compeve advantage +

management execuon track record

  • Cyclical tailwinds (if any)
  • Quality of growth
  • Average daily trading

volumes

  • Risk parameters based on

limits on liquidity coverage

  • Parcipaon rates
  • Capital allocaon across

business cycles

  • Number of diluons in the

past and peak debt levels

  • Working capital pracces
  • Historical ROCE trend
  • Success rate and adjacency

in diversificaons, if any

  • Capital intensity of the

business

  • Dividend payout history
  • Promoter pledges
  • Board composion and

compensaon

  • Related party transacons
  • Promoter’s other interests

and funding

  • FCF generaon
  • Valuaon risk-reward

framework based on

  • Earnings sensivity
  • Long term valuaon range
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RISK MANAGEMENT

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*Not accounng for passive breaches

  • No deliberate cash calls
  • To be governed by relave

risk reward opportunity and stock liquidity

  • Maximum allocaon to a

stock limited at 10%*

  • As per internal risk

management guidelines

  • Sufficient cash levels to be

maintained to meet redempon and porolio churn requirements

  • Out of an approved

universe of stocks

  • Stocks analysed across

sectors by dedicated analyst team

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MEET THE FUND MANAGER

Rupesh Patel

Senior Fund Manager, Tata Asset Management Ltd 16

Rupesh has 19 years+ of experience spread across

  • Credit risk assessment and
  • Private equity real estate investments,
  • Evaluaon of infrastructure projects
  • Listed equity investments,

Funds managed by Rupesh – Tata Midcap Growth Fund, Tata Large Cap Fund, Tata India Tax Savings Fund, Tata Infrastructure Fund and Tata Ethical Fund & Tata Offshore India Sharia Scheme Prior to joining Tata Asset Management, he worked with Indiareit Fund Advisors Private Limited in their investments team and held directorships to represent Indiareit Fund Advisors Private Limited on the boards of investee companies. He has also worked as head of Corporate and Infrastructure Rangs group at CARE Rangs. He is a graduate in engineering and also MBA from Sardar Patel University, Gujarat

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EXPERIENCED TEAM OF

ASSISTANT FUND MANAGERS & ANALYSTS

Meeta Shey Ennee Fernandes Amey Sathe Abhinav Sharma Sash Mishra

  • Sectors: IT, Pharma,

Telecom

  • 13+ years experience,

CFA Charter holder & Bachelor in Economics

  • 10+ years experience,

PGDBM

  • Sectors: FMCG, Retail,

Consumer Durables, Building Products, Media, Textile

  • 13+ years experience,

MMS, CFA Charter holder

  • Sectors: BFSI
  • 13+ years experience,

PGDM

  • Sectors: Construction,

Capital Goods, Power Utilities, Cement and Logistics

  • 13+ years experience,

PGDM

  • Sectors: Oil & Gas,

Metals & Mining and Chemicals

2000+ company interacons in a year Sector focus – All major sectors covered

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FUND DETAILS

Addional Investment: Rs 1,000/- and in mulple of Re 1/- thereaer. Load Structure Entry Load (During NFO): N.A. However, there is no assurance or guarantee that the investment objecve of the Scheme will be achieved. The scheme does not assure or guarantee any returns. Type of Scheme An Open Ended Equity Scheme invesng in maximum 30 stocks across market caps (i.e. mulcap). Investment Objecve The investment objecve of the scheme is to generate long term capital appreciaon by invesng in equity & equity related instruments of maximum 30 stocks across market caps. Exit Load: 1% of the applicable NAV, if redeemed/switched out on or before expiry of 365 days from the date of allotment. Benchmark S&P BSE 200 TRI Scheme Name TATA FOCUSED EQUITY FUND Fund Manager Rupesh Patel NFO Dates NFO OPENS: 15th November 2019 • NFO CLOSES: 29th November 2019

  • Min. Investment Amount
  • Rs. 5,000/- and in mulple of Re.1/- thereaer

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DISCLAIMER

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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.

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SLIDE 20

Thank You

Call: 022 - 6282 7777 (Monday to Saturday 9:00 am to 5:30 pm) www.tatamutualfund.com