Teji Mandi's investment strategy melds tactical bets with long-term winners. Combined with disciplined rebalancing we ensure adequate risk management with return maximization.

Tactical Bets

  1. Industry Consolidation

A competitive advantage is seen for a larger established entity in a specific sector

Example: In the banking sector, large private sector banks will gain significant market share on account of conservative underwriting, aggressive provisioning and strong liability franchise

  1. Government Policy

A change in government policy could create an opportunity for certain companies and sectors to innovate or expand.

Example: A government ban on electronic products from China would benefit companies in the Indian electronics sector

  1. Industry Tailwinds

External conditions could be favourable to specific stocks/sectors driving supernormal growth

Example: Due to above-average rainfall last year, the rabi crop was strong this year. Good crop production has led to tractor, fertilizer and agro-chem companies performing well.

Long-Term Winners

  1. Proven Track Record

Companies with a proven growth track record of profits over the last 1, 3 and 5 years

  1. Strong Growth Triggers Ahead

A meaningful growth runway should be visible for the companies going forward

  1. Prudent Capital Allocation

In most cases, companies must display operating ROEs upwards of 15%. Even incremental ROEs should be north of this

  1. Beaten Down Stocks

Due to certain near term concerns, some high-quality stocks get beaten down disproportionately.Risk/reward ratio in such companies is usually an attractive proposition over the long-term.

Disciplined Rebalancing

We will also sell when the initial hypothesis, with which we bought a stock, has run its due course

  1. Investment thesis is no longer valid due to
  • Entry of a large competitor into the sector

  • The company's capital allocation policy has changed

  • The company has entered into an unrelated industry

  • The company has had a major management overhaul

  1. Substantially better risk/reward opportunity in Companies or Sectors with better growth prospects
  • Companies with better capital allocation policies

  • An alternate sector that is seeing significant tailwinds

  1. Too much noise
  • There are situations where a specific industry/company is in a negative light

  • When there is a concern in terms of earnings or a corporate governance issue

  • There is a change in management or the current competitive scenario.

  1. Liquidity Management

We hold a percentage of the portfolio in Cash or Liquid ETFs in extreme situations

  • When the market is overheated (High Volatility)

  • There is a negative global event/externality beyond our control (Pandemic / Political Events)

What do you think? Do you have any questions regarding our portfolio strategy? Email me at [email protected] with your feedback and questions.