Centrum PMS

PMS Rating

IME PMS Rating

3 of 5 stars

Can be considered for investment: Centrum PMS has developed strong credentials in the small & mid-cap space. A key concern is churn at the CIO level (both Kunj Bansal & Anil Sarin, past senior CIO's having left the firm), keeping a high level of dependence on Abhishek Anand (a relatively more junior fund manager but who has been with the firm for a long-time).

The PMS/AIF AMC Rating is derived on the basis of our analysis on 5 key qualitative parameters that we use to analyse the quality of a PMS/AIF Provider. These include an assessment of the size of the AMC, the pedigree of the AMC, the pedigree of the team, the value of the investment philosophy & the level of differentiation. These insights of our central research team are documented in the IME RMS, and can be accessed during a consultation call with an IME PMS specialist.

PMS Background

Discretionary AUM (528cr) | Promoter Category ()

PMS Background

Centrum PMS is the PMS house of the Centrum group (a well-respected financial services group founded in 1997, with lending, broking and investment management arms).

PMS Investment Philosophy

Centrum PMS is driven by their proprietary framework developed over time — ‘EDGE’ Framework. The AMC uses the EDGE framework to identify leaders.

EDGE Framework

  • Earnings Growth (E): driven by criteria such as minimum ~15% EBITDA growth and ~15% ROCE | High cash to EBITDA ratio (65% and above) | Low leverage (<2x) | used as a filter¬†
  • Deep Dive Research (D): driven by factors like size of the opportunity, competitive advantage, scalability and channel checks
  • Governance (G): evaluated based on accounting quality, past capital allocation, past related party transactions and dividend policy
  • Execution (E): past track record and promise vs delivery historically

The above-mentioned EDGE framework is used to identify leaders.

Leadership traits are defined as

  • Market Share
  • Promoter/Management Pedigree
  • Operating Margins and Return Ratios
  • Brand/Distribution Strength
  • Business Growth and Pricing Power
  • R&D and Technology Differentiators

Portfolio Construction Strategy

Centrum strategies classify and take positions in companies labelled as ‘Quality’, ‘Value’, and ‘Growth’. The aim is to have approximately equal weightages across the 3 styles

  • Quality (for stability): Companies with a strong leadership positions, known for their proven track record
  • Value (back-ended performance, but strong upsides): counter cyclical, contrarian, special situation opportunities
  • Growth (for alpha): emerging but lesser-known companies with high growth potential and leadership traits

The AMC believes that this reduces risk and ensure participation during various phases of market cycles.

Inv Team

Investment Team

PMS/AIF Schemes

PMS & Listed Equity AIF Schemes

Scheme Category Style 1 yr 3 yr 5 yr Since Inc
Centrum Good To Great T NRI Mid & Smallcap Value 44.3 18.5 19.4
Centrum Microcap Small Cap GARP 44.3 29.9 26.7 18.2
Centrum Built to Last Large Cap GARP 22.1 10.5 10.9

Returns as of 28-Feb-24.

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Note: PMS AMC & Scheme Reviews and Ratings are based on IME Capital’s Proprietary Review and Rating Methodology (read more here: AMC Rating & Scheme Ratings). These reflect the unbiased views of our central research team, based on our assessment of the investment value of these PMS/AIF strategies for our investors. We follow a highly stringent rating-criteria, where approximately 50% of PMS AMC’s & strategies would be rated 2-star or below (this is not meant to indicate that these funds are not investment-worthy, but that they do not currently fulfill the requirements we focus on for recommending funds to our investors — based on our internal views on the merit of the AMC/strategy relative to peers). Reviews & Ratings are primarily based on research of publicly available information (SEBI disclosures, PMS websites, PMS-aggregation platforms, webinar recording, media interviews etc.) and no explicit consent is required from AMCs for the same. While we endeavour to do further due-diligence via direct interactions with the investment teams of AMCs, this is typically restricted to AMC’s that meet our foundational fund selection criteria (reviews on lower-rated AMCs are often based solely on publicly available information). The views reflected in our Reviews & Ratings, are our independent views and may not be shared by the AMC’s and the investment teams. Please read detailed disclaimer for more.