1st April 2019

Meaning of Aequitas

Equity Advantage

Why Aequitas?

Process flow

Risk

Pitfalls we avoid

Discipline

Our Report Card

Investment Philosophy

- Multi-bagger Approach

- Portfolio Construction

- Company Attributes

Our Stock picks

Key personnel

Best in class process

Contact details

Disclaimer

INDEX

Aequitas InvestmentAequitas Investment

Aequitas is the Latin goddess of Equity and

Fairness. She is most often depicted holding a pair of

scales to represent Fair Dealings and Equality.She is shown in a dignified pose, wearing

a diadem and holding a sceptre or staff, and sometimes

She is also given a cornucopia, the symbol of

abundance and wealth. She represents true fairness, a

different concept from justice for justice is under the

law, and must follow it to the letter. Some have

seen in her a Goddess of honest merchants and

fair dealings in contracts, negotiations, and other merchant-

related endeavours: by this definition the cornucopia is seen

as a symbol of the wealth to be gained through fair enterprise.

Aequitas

Aequitas

The word “Equity” originatesfrom the Latin word Aequitas

Why Aequitas ?Low churn ratio &

low transaction cost

Tax efficient investing; lower taxes on long term holdings

No distributors and intermediaries; grown through references

Best risk adjusted returns

Best 5 year performance

Aequitas Investment

What Aequitas does differently!!!

We don’t work with Distributors. Never have, never will !

We don’t watch financial news channels!

We don’t use Bloomberg. It’s an avoidable distraction!

We have only one product. Only one yardstick to measure our performance!

No marketing person. Our product should be good enough to sell by itself!

Bespoke portfolios, no model portfolio. Models look good only on the ramp!

Aequitas Investment

Process flow

SCREENERS RESEARCH PORTFOLIOCONSTRUCTION

ONGOINGRESEARCH

- Sales growth, PAT growth, capacity utilisation

- Valuation dislocation -EV/Sales, PE ratio, EV/EBITDA

- Debt- Dividend track record- Promoter ownership- Insider Buying- Industry Leadership- Credit rating- Long term track record

- Annual report- Quarterly results- Industry & company news- Management interviews- Third party research- Management meetings- Press releases- Conference calls/

Analyst meets

- 15-20 stocks- Balance across sectors- Catalyst for stock

re-rating

Aequitas Investment

RISK

• Risk is not a number, it is a concept or a notion. Risk equates to what Ben Graham called a “permanent loss of capital”.

• Modern finance measures risk on metrics like standard deviation, BETA, VAR etc. which we do not subscribe to.

• We measure risk on 3 parameters

Aequitas Investment

Valuation Risk Earnings Risk Balance Sheet Risk

Risk of buying stocks dearwithout adequate marginof safety. Reasonablevaluation is thecornerstone of all ourinvestment decisions.

Risk that current earningscould decline due totechnological changes,economic changes ordeterioration inmanagement

The risk of an over-leveraged balance sheetwhich is ignored duringgood times in favour ofthe cyclically high and un-sustainable earnings.

Aequitas Investment

PITFALLS WE AVOID

IPO’s

Leverage

Fad or hot sectors

Low promoter holding

Corporate governance

QIP’s or secondary equity sales

High institutional ownership

Expensive valuations

DISCIPLINE

- Avoid impulsive decisions

- Don't focus much on market movements

- Don't chase winners or hot stocks

- Avoid trading and short term investments

- We don't do derivatives

Aequitas Investment

Our Report Card

Past performance is no guarantee of future results. Past performance may or may not be sustained in future. Aequitas Investment

Chart depicts absolute performance since inception; Returns are adjusted for inflows/ outflows and are after expenses; 31st March, 2019

Aequitas Nifty Mid Cap Index Small Cap Index Avg Small & Mid Cap MFCap MF

Investment Philosophy

Aequitas Investment

Multibagger Approach

Aequitas Investment

GROWTH CONTRARIAN VALUE

The company has to be a growth company with above Average growth potential for The next 3-5 years . Markets

reward a higher PE multiple for growth companies

Contrarian approach does not mean doing the opposite

of others, it means doing things differently. Buying in popular names will not give

Multi-bagger returns

The valuation has to be reasonable. This is important

because there has to be potential for re-rating. A

combination of EPS growth and PE re-rating leads to

Multi-bagger returns

Doing things differently

Above average growth

Cheap valuationensures potentialre-rating

XX

MuLTIBAGGER

=

Portfolio Construction

• We invest in quality companies with a focus on small and mid-cap growth companies

• Most market participants focus on price; we focus on company fundamentals

• We aim to construct a portfolio of 15-20 stocks across various sectors

• Invest with a 3-5 year horizon with a focus on low churn rate

• Value can remain value for long time. We actively look for catalysts which will lead to stock rerating.

IndustryProspects

QualityCompanies

ConcentratedHolding

Long-termOutlook

Catalyst

Aequitas Investment

Company Attributes

Most of the companies in our portfolio are industry leaders with a strong sustainable competitive advantage

Industry Leaders

Companies need to have very low debt levels and some of the companies are in fact net cash positive

Low Debt

Good dividend paying record, corporate governance

practices & sound long term performance record is a must.Management

The portfolio PE ratio is less than market PE ratios (adjusted for cyclicality in earnings).Valuations

Majority of our companies have done buy-back / creeping acquisition in the 12 months prior to our initial acquisition

Creeping acquisition/ buybacks

Our portfolio includes companies with strong and consistent cash flow generationCash flow

Aequitas Investment

Our Stock Picks

Aequitas Investment

Avanti Feeds Finolex Cables

✓Industry Leadership

✓

✓Low debt to Equity (<1 )

✓

✓Institutional Ownership (<20%)

✓

✓Listing History (>10 years)

✓

✓Low Equity Float

✓Valuation (<12 PE)

✓

Introduction of Vannamei shrimps Catalyst Exceptional write offs

Our Stock Picks

Aequitas Investment

HEG Ltd. Garware

✓Industry Leadership

✓

Low debt to Equity (<1 )

✓

✓Institutional Ownership (<20%)

✓

✓Listing History (>10 years)

✓

✓Low Equity Float

✓

✓Valuation (<12 PE)

✓

Global GE capacity shutdown Catalyst Buyback

Our Stock Picks

Aequitas Investment

CCL Products Heritage Foods

✓Industry Leadership

✓

Low debt to Equity (<1 )

✓Institutional Ownership (<20%)

✓

✓Listing History (>10 years)

✓

✓Low Equity Float

✓

✓Valuation (<12 PE)

✓

Commencement of Vietnam plant Catalyst Healthy dairy sector outlook

Our Stock Picks

Aequitas Investment

Vindhya Telelinks Maharashtra Seamless

✓Industry Leadership

✓

✓Low debt to Equity (<1 )

✓

✓Institutional Ownership (<20%)

✓

✓Listing History (>10 years)

✓

✓Low Equity Float

✓

✓Valuation (<12 PE)

✓

Increase in Order Book Catalyst Anti Dumping Duty on Pipes

Aequitas Equity Fund

KEY PERSONNEL

SIDDHARTHA BHAIYA, Managing Director & Fund Manager

Siddhartha founded AICPL in 2012 with the aim of creating long term wealth for

clients. As a fund manager of AICPL, Siddhartha has outperformed the NIFTY in

6 out of 7 years and delivered a CAGR of 37.77%. He is a qualified Chartered

Accountant and prior to AICPL, managed funds at Reliance Capital Asset

Management.

NEERAV SHAH, Director - Operations

Neerav is a qualified Chartered Accountant and has more than 14 years of

experience in capital markets. Neerav is a part of Aequitas since inception. In the

past he has handled operations, fund accounting & dealing functions at various

points in his stint at Reliance Capital Asset Management and Birla Sunlife.

Aequitas Equity Fund

BEST IN CLASS PROCESSES

Working with leading service providers to ensure best in class services to clients

SEBI registered

Cat III fund

Audit & Tax

consultants

Top Institutional

Brokers

Bankers

Custodians

Trustee to the Fund

Reporting

❖ Monthly Performance appraisal statement❖ Monthly Portfolio appraisal statement❖ Monthly transaction statement❖ Monthly bank book❖ Audited statements at end of financial year

Contact Details

Aequitas Investment

704/705, 7th floor, Balrama Building,Plot no 3c, E block, Bandra Kurla ComplexMumbai 400 051

siddhartha.bhaiya@aequitasindia.inneerav.shah@aequitasindia.in

Siddhartha Bhaiya : +91 93221 85876Neerav Shah: +91 93229 33951

www.aequitasindia.in

Investment features and fee structure

Minimum Investments Residents – INR 10 crs.Non Residents – USD 1.5 mn

Suitable time frame 3 years

Mode of inflow Cash inflow or stock transfer

Fees 2% of daily average AUM to be charged on a monthly basis

Performance sharing 10% profit sharing with high water marking to be charged annually atthe end of financial year

• The views expressed herein are the personal views and constitute only the opinions and do not constitute anyguidelines or recommendation on any course of action to be followed by the readers. This information is meant forgeneral reading purpose only and is not meant to serve as a professional guide for the readers. This document hasbeen prepared on the basis of publicly available information, internally developed data and other sources believed tobe reliable. The Sponsor, Aequitas Investment Consultancy Private Limited (AICPL) or any of their respective directors,employees, affiliates or representatives do not assume any responsibility for, or warrant the accuracy, completeness,adequacy and reliability of such information. Whilst no action has been solicited based upon the information providedherein, due care has been taken to ensure that the facts are accurate and opinions given fair and reasonable. Thisinformation is not intended to be an offer or solicitation for the purchase or sale of any financial product orinstrument. Recipients of this information should rely on information/data arising out of their own investigations.Readers are advised to seek independent professional advice and arrive at an informed investment decision beforemaking any investments. The Sponsor, AICPL or any of their respective directors, employees, affiliates orrepresentatives shall not be liable for any direct, indirect, special, incidental, consequential, punitive or exemplarydamages, including lost profits arising in any way from the information contained in this material.

• The Sponsor, AICPL, any of their respective directors, employees including the fund managers, affiliates,representatives including persons involved in the preparation or issuance of this material may from time to time, havelong or short positions in, and buy or sell the securities thereof, of company(ies) / specific economic sectors mentionedherein.

• Risk factors: Investments in securities are subject to market risks. There are no assurances or guarantees that theobjectives of any of the Products will be achieved. The investments may not be suited to all categories of investors. Thevalue of the Portfolios can go up or down depending on various market factors. Past performance of the PortfolioManager does not indicate the future performance of the Products or any other future Products of the PortfolioManager. Investors are not being offered any guaranteed or indicative returns through any of the Products. Thenames of the Products do not in any manner indicate their prospects or returns. The performance of the Products maybe adversely affected by the performance of individual companies, changes in the market conditions, micro and macrofactors and forces affecting capital markets in particular like interest rate risk, credit risk, liquidity risk andreinvestment risk. The Portfolio Manager is not responsible or liable for any loss resulting from the operations of theProducts/ Portfolios. Each portfolio will be exposed to various risks depending on the investment objective, investmentstrategy and the asset allocation. Non-Diversified Portfolio tends to be more volatile than diversified portfolio. AICPL isa SEBI registered Portfolio Manager. Please read the Disclosure Document before investing.

Disclaimer

Aequitas InvestmentAequitas Investment