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2Point2 Long Term Value

Scheme Rating

IME Scheme Rating

3 of 5 stars

Reasonable Investment Option in Flexi-caps: While the investment philosophy and performance track record of 2Point2 Capital’s Long-term value fund are strong, we would ideally prefer the strategy & team to mature a little more. It is also important to note that the high levels of small-cap exposures in this strategy, make it a higher risk-reward strategy than other more diversified Flexi-caps.

IME Strategy Rating

3 of 5 stars

Sustainable Approach: The strategy fcouses in long-term return generation through a concentrated portfolio approach, strategically holding 15-18 businesses. Employing a Market Cap Agnostic stance, it leans towards value, with a current emphasis on mid-small caps, optimizing the portfolio for sustained performance.

PMS Scheme Ratings are driven by IME’s Proprietary Scheme Rating Methodology, which takes into account our ratings of the Scheme’s investment strategy, its maturity, the investment team, and our separate rating on the AMC that runs this particular scheme. Our views on each of these individual criteria are available via the IME RMS – which you can view by reaching out to one of our relationship managers (using either the live chat or book appointment feature on this site).

IME View on 2Point2 Long Term Value

Type: Flexi Cap | Value | AUM (1244 cr) | Inc Date (20 July 2016)

2Point2 Capital Long Term Value Fund- Investment Strategy

Concentrated exposure following value investment philosophy

2Point2 Capital’s Long Term Value Fund follows a value-investment philosophy to build a concentrated 15-stock multi-cap portfolio of companies with strong moats, high ROEs and free cash flow generation that are available at reasonable valuations.

Investment Philosophy 

Businesses chosen for investment based on: 

  • Competitive Moat: Businesses that have a strong competitive moat are able to create shareholder value. They seek to invest in businesses that have a strong competitive moat. Competitive moat that attract them are those driven by strong brands, distribution strength, having a cost advantage, technology  and high switching cost. This showcases high capital efficiency and are cashflow positive. Also try to avoid businesses driven by regulations and political linkages. 
  • Margin of Safety: Seek to maintain valuation discipline by investing only at discount to intrinsic value resulting in margin of safety. This may lead to staying in cash in periods of unreasonable euphoric market and investing in periods of distress. Follows the principle of ‘Be fearful when others are greedy and greedy when others are fearful’. 
  • Corporate Governance: Believe in stabilized long-term returns can be achieved by partnering with  managements which treat minority shareholders as equal partners. Avoid partnering with businesses with weak corporate governance practices and invest only in businesses with ethical management teams. 
  • Sectors: Prefer to invest in sectors that have long term growth opportunities. Avoid investing in highly regulated sectors, sectors linked to commodity prices, ‘fad’ driven sectors and sectors exposed to technological disruption. Also avoid investing in sectors that over long period generate accounting profits and not cash flows.  

Trailing Performance

1yr 3yr 5yr Since Inception
2Point2 Long Term Value 50.2 23 22.9 21.3
S&P BSE 500 TRI 39.5 19.5 19 15.9
Alpha over Broad Mkt BM 10.7 3.5 3.9 5.4
Nifty 500 38.4 18.1 17.5
Alpha over Category BM 11.8 4.9 5.4

Performance as of: 28-Feb-23 | Inception Date: 20-Jul-16

Fund Managers

Amit Mantri | 3-star rated FM

Co-Founder & Fund Manager | 14 yrs Experience | 8 yrs at current firm

Past Experience: Hornbill Capital (VP), IDFC Alternatives, Zephyr Paeacock (VP)

Amit comes from a private equity background, with 5 years of PE experience at Zephyr Peacock and a short stint at IDFC Alternatives. Prior to founding 2Point2 Capital, Amit spent a year at Hornbill Capital (a Mumbai based hedge fund, co-sponsored by Orchid Asia – manager of $3bn+ of Asian equity assets).

Savi Jain | 3-star rated FM

Co-Founder & Fund Manager | 16 yrs Experience | 8 yrs at current firm

Past Experience: Jashn (Director), Tano Capital (Director), Frontline Ventures (Analyst)

Savi comes from a private equity background, with around 6 years of experience in Tano Capital (Mumbai based PE fund managing over $200 mn of assets) & Frontline Ventures.

Fee Structure

Fee StructureFee
Fixed Fee Structure
Variable Fee Structures1.5% fixed + 15% above 10% hurdle
Exit Fees1yr(3%)

AMC

AMC: 2Point2 PMS (click link for detailed AMC review)

Not a top recommendation as it is still a young AMC at this time : 2Point2 Capital has scaled rapidly in a short period of time, driven by the strong initial performance of the portfolios. However, given the relatively short track record for both the firms and their principal founding fund managers, we would advise investors to wait a few more years for the strategy to mature.

AMC Rating

3 of 5 stars

AMC Pedigree

3 of 5 stars

AMC Size

4 of 5 stars

Team Pedigree

3 of 5 stars

Inv Philosophy

3 of 5 stars

Performance

4 of 5 stars

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