Marcellus PMS
PMSIME's View on Marcellus PMS
AMC View
Marcellus offers strong investment options for those interested in high quality companies, but their lack of flexibility in investment approach hinders performance across market conditions. Recent weak performance and limited portfolio repositioning capabilities contribute to lower ratings for the seasoned investment team.
AMC Pedigree
Marcellus, a respected PMS house, was founded by the core team behind Ambit's investment business. They have a strong focus on investing in high-quality franchises. While Marcellus got off to a very strong start, their very aggressive focus on their investment philosophy on high-quality franchises (even willing to ignore valuations) has limited their ability to reposition portfolios as the market cycle turned leading to very sharp underperformance which has adversely impacted their reputation in recent times.
Team Pedigree
Marcellus has a strong investment management team led by highly experienced professionals Saurabh and Rakshit, who possess strong track records and research credentials. The team's longevity and leadership as founders ensure stability in their philosophy and practices.
Investment Philosophy
Marcellus prioritizes investing in top-quality businesses with strong management and transparent accounting practices, following this philosophy consistently across all their strategies. While the philosophy has very clear merit, the issue can be that this is followed very rigorously, which does reduce the flexibility that the fund manager has to reposition the portfolio during economic upcycles & strong bull markets - where many sectors & companies with lower quality scores may be driving performance.
AMC Background
Marcellus was founded in 2018 by bringing together the highly successful team (Saurabh Mukerjea, Pramod Guppi, Rakshit Ranjan) that were instrumental drivers of the growth of Ambits Investment Management business. At Ambit, the investment team of Saurabh & Rakshit delivered multiple years of strong outperformance driven by a strategy of investing in high-quality franchises with the highest levels of corporate governance. Backed by its strong founding team pedigree, Marcellus has in a very short period of time-scaled to become one of the largest (top-10 PMS houses) and most respected PMS providers in India.
AMC driven by a Strong Investment Team
Marcellus has one of the strongest investment management teams, with both Saurabh and Rakshit being highly seasoned investment professionals, with strong track records and fundamental research credentials. The AMC's
Investment Philosophy
Marcellus follows a very clearly defined investment philosophy that essentially seeks to make long-term investments in high-quality business franchises. Their investment approach has 3 core pillars:- Clean Accounts: A combination of forensic accounting & capital allocation assessments help determine how clean a company’s books are. This helps narrow the investible universe (Saurabh has been one of the foremost experts in the use of forensic accounting to identify potential issues in company accounts)
- Capital Allocation: Invest only in companies with a strong track record of efficient capital allocation
- Competitive Advantage: Seek to only invest in companies that have very strong competitive moats Marcellus (and the same team prior at Ambit) is known for a rigorous following of these quality filters and to invest in only the highest quality companies (often willing to pay very high premiums to invest in top quality franchises).
Focus on High Quality Businesses
Marcellus has a very clearly defined investment philosophy of buying very high-quality businesses across their strategies, with strong managements that have clean accounting. The strategy also follows a concentrated approach with positions built based on the investment team's conviction. This is a continuation of the same strategy with an existing track record from Ambit Capital by the same team that ran the strategy.
Suitable For
Investor's seeking to invest in the very highest quality companies (regardless of valuations), to benefit from the LT compounding benefit of high-quality businesses. This strategy could potentially underperform in strong bull markets.Investment team
Rakshit Ranjan | 4-star rated FM
Fund Manager | 21 yrs Experience | 7 yrs at current firm
Past Experience: Ambit Capital (FM), Lloyds Banking (Director Research), Noble & Co (Analyst)
Rakshit has a strong investment management track record, having launched Ambit's Coffee-Can PMS in Mar-17, which he ran till Dec-18. The Coffee-Can PMS was one of the best-performing PMS schemes in 2018. Prior to setting up the Coffee-Can PMS, Rakshit was the lead consumer analyst at Ambit. His earlier experience was in UK equities at the Lloyds & Noble groups.
Saurabh Mukherjea | 5-star rated FM
Founder & CIO | 28 yrs Experience | 7 yrs at current firm
Past Experience: Ambit Capital (CEO), Noble (Head of India Equities), Accenture (Consultant), London Economics (Consultant)
Saurabh comes with a very strong investments background, having helped build Ambit's broking, wealth & investment management businesses as CEO. He was also responsible for building Execution Nobles India broking business (which was sold to Ambit) and having set up and sold Clear Capital (a UK based small cap research fund). Saurabh is a strong believer in investing in the long-term in very high quality clean businesses and has written a number of books including Gurus of Chaos, The Unusual Billionaires and Coffee Can Investing.
Ashvin Shetty | 3-star rated FM
Portfolio Manager | 22 yrs Experience | 7 yrs at current firm
Past Experience: Analyst (Ambit), Analyst (Execution Noble), Statutory Auditor (KPMG)
Ashvin Shetty has more than a decade of experience in equity research. Previously, at Ambit, he led the coverage on automobile sector from 2010 to 2017. Ashvin was recognised multiple times for his stock picking abilities. He was ranked in Starmine Analyst Awards 2013 and 2016 as a lead auto analyst. He later moved onto become a senior analyst for Ambit's Mid and Small cap PMS funds till November 2018. Prior to joining Ambit, he worked with Execution Noble as an analyst covering consumer and media space. He has also worked with KPMG's and Deloitte's statutory audit departments from 2004 to 2007 gaining extensive experience across Indian accounting standards and financial statement analysis. Ashvin is a BCom graduate from Narsee Monjee College (Mumbai). He is a qualified Chartered Accountant (ICAI India) and Chartered Financial Analyst (CFA Institute, USA).
