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Solidarity PMS

PMS Rating

IME PMS Rating

4 of 5 stars

Highly recommended for aggressive investors looking for Multi Cap strategies with PE Style Approach: Investing in Solidarity PMS is essentially investing with Manish Gupta and taking a call on his ability to leverage his substantial experience in corporate strategy & private equity to deliver outperformance while managing listed equities. The premise is interesting, but we would ideally like to wait a few more years to analyse performance across market cycles.

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 (1591cr) | Promoter Category ()

AMC Background

Solidarity PMS was founded in 2014 by Manish Gupta, a seasoned private equity professional (managed the PE investments for Rakesh Jhunjhunwala) with a strong experience in corporate strategy (BCG, Honeywell).

Investment Philosophy

Investment Philosophy driven by 'Is this company we would like to own?'

  • Broadly Predictable Growth: Companies with large addressable markets, and structural industries tailwinds
  • Improving Edge: Favourable industry structure, sector/niche leadership, competitive advantage and ability to deploy capital for growth at ROE >15%
  • Disciplined Management: Focus on few business lines, disciplined capital allocation, prudent use of leverage and learning organisation.

Things that Solidarity does not do

  • Don’t believe in model portfolios: model portfolios imply that current valuations do not matter, so the strategy invests in the best opportunities at present
  • No cash calls based on macro events

Valuations

Sensitive to growth stage of the life cycle. With more mature business growth, the higher the need for valuation sensitivity.

Portfolio Construction

  • Portfolio Allocation: 40-50% in ‘Clear Leaders’, 40-50% in ‘Emerging Leaders’, and ~10% in ‘Special Situations’.
    • Clear Leaders (15-18% IRR Ask): Leaders in a growing market, with dominant share of the profit pool and robust business model & balance sheet.
    • Emerging Leaders (18%+ IRR Ask): on path to becoming leaders, typically in a specific niche
    • Special Situations (25% IRR Ask): good businesses undergoing temporary uncertainty with high price-value divergence.
  • Concentration: 15-20 companies with minimum 3% position size
  • Position sizing: may vary between 3-15%
  • Risk Management: Avoid poor governance and excess leverage. Volatility is not risk.
  • Sell: 1) euphoria in valuations and/or 2) new facts change the view

Inv Team

Investment Team

Manish Gupta | 4-star rated FM

Founder & CIO | 27 yrs Experience | 10 yrs at current firm

Past Experience: RARE Enterprises (MD-Private Equity), Honeywell (Director-Strategy), BCG (Strategy Consultant)

Prior to founding Solidarity in 2014, Manish worked with Rakesh Jhunjhunwala for 8 years as the Managing Director for Private Equity Investments at Rare Enterprises. His prior experience includes 7 years of strategy consulting with the Boston Consulting Group.

PMS/AIF Schemes

PMS & Listed Equity AIF Schemes

Scheme Category Style 1 yr 3 yr 5 yr Since Inc
Solidarity Prudence Flexi Cap GARP 22.8 12.4 21.3 18

Returns as of 28-Feb-24.

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Our RMS allows us to operate with a level of transparency, ethics & consistency of insights, that is unparrarelled in the industry. Our RM’s will help showcase the PMS/AIF options that are the most suited for your unique requirements.

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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.