Alchemy Smart Alpha 250 AIF
Alchemy PMS | Equity | | AIFIME's View on Alchemy Smart Alpha 250 AIF
Strategy
Algorithm based Large & Midcap Strategy
Investment Fund
This fund replicates Alchemy's PMS strategy of the same name and was introduced primarily for tax benefits. While we appreciate the open-ended AIF structure, the PMS strategy itself is still in the process of building a track record, making this a relatively untested approach.
Fund's Strategy View
The strategy focuses on large and mid-cap investments, building a concentrated portfolio of 25 high-conviction stocks across sectors like consumer discretionary, financials, and industrials, guided by the AMC’s proprietary eQGP (Environment, Quality, Growth, Price) framework. A quant methodology is applied with scores given on each of the eQGP factors, in order to arrive at a final score - which forms the basis of final portfolio construction. While there is a quant-framework, the underlying scoring of the eQGP factors is still qualitative judgements of the core investment team (so this accordingly cannot be considered a quant fund).
Fund Performance
A lack of 5 yr trailing performance data from our identified reliable data sources, prevents us from having a clear performance rating on the fund.
IME's View on Alchemy PMS
View on AMC
Alchemy, backed by strong founders and a seasoned CIO, has shown meaningful performance recovery across strategies. The firm’s consistent investment approach and ability to identify quality businesses are translating again into improved outcomes. With performance momentum returning and its core philosophy intact, Alchemy now merits a higher conviction and a 4-star rating
AMC's Pedigree
Alchemy is a leading broking and PMS provider in India with a highly experienced founding team. However, a SEBI verdict (in Mar-23) against one of their founders in an insider trading case is a cause for concern, although he is not directly involved in the PMS operations.
AMC Team
Alchemy has a strong investment team led by co-founder and CIO Hiren Ved, who brings stability, experience, and respect to the firm.
Investment Philosophy
Alchemy excels in bottom-up stock picking but lacks a clearly defined investment philosophy, allowing flexibility in shifting between investment themes but making it challenging to understand the investment strategy.
Investment Strategy
Alchemy Smart Alpha 250 Fund is a Category III AIF that utilizes a quantitative, rules-based approach to invest in large and mid-cap equities. The strategy aims to generate high alpha with lower volatility, balancing stability from large-cap stocks with high-growth opportunities in mid-caps. The fund follows a systematic investment process, leveraging its proprietary eQGP framework (Environment, Quality, Growth, Price) to construct a concentrated portfolio of 25 high-conviction stocks.
Core Investment Approach
eQGP Framework for Stock Selection:
- Environment: Adjusts exposure based on liquidity conditions, interest rates, corporate profit trends, and macroeconomic factors.
- Quality: Evaluates businesses on capital efficiency, leverage, cash flow consistency, and management strength.
- Growth: Focuses on profit growth, market share expansion, and operational efficiency.
- Price Action: Incorporates ownership trends, risk-reward dynamics, and liquidity factors to optimize entry points.
Dynamic Portfolio Construction & Rebalancing:
- Invests at least 65% in listed equities (large & mid-cap stocks).
- Can allocate up to 10% to IPO opportunities or other instruments.
- Portfolio is rebalanced regularly to adapt to changing market condition
Portfolio Construction Process
- Top 250 Companies by Market Cap – Investment universe limited to the largest 250 companies.
- Scores Based on QGP Framework – Companies are ranked based on their Quality, Growth, and Price factors.
- Weights Assigned Based on the Score – Higher-scoring companies receive larger allocations.
- Top 25 Companies Selected – The highest weighted average scores determine final portfolio inclusion.
- On-Going Rebalancing – The portfolio is continuously optimized based on market and stock-specific changes.
AMC Background
Alchemy was founded in 1999 by Lashit Sanghvi, Hiren Ved, Rakesh Jhunjhunwala, and Ashwin Kedia, a group with over 100 years of collective experience in Indian equities. The investment strategies are actively managed by Hiren Ved, who continues to serve as CIO and primary fund manager, while Rakesh Jhunjhunwala and Ashwin Kedia are not involved in day-to-day operations. Alchemy is regarded as one of the strongest bottom-up stock-picking PMS houses in India and has scaled to become one of the largest PMS platforms in the country (ranked among the top four). The continued leadership of Hiren Ved provides long-term stability to the investment team, a critical factor in sustaining performance and organisational growth.
Investment Philosophy
Alchemy relies more on a disciplined and repeatable investment process to identify attractive bottom-up opportunities than on a narrowly defined investment philosophy. The flexibility of this approach allows the fund manager to adapt positioning across market conditions, while remaining anchored to fundamental research and valuation discipline.
Alchemy’s Investment Process – 3I Matrix
- Idea Generation: Tracks a broad universe of ~500 companies, with deep coverage of 100–150 names. Ideas are generated through internal research as well as external inputs such as industry interactions, peer discussions, and sector conferences.
- Investment Process: Managed by the CIO, who retains veto power at multiple stages of research and portfolio construction. Positions are continuously monitored and formally reviewed on a quarterly basis.
- Intervention: Active intervention by the CIO in portfolio sizing, risk management, and exits, based on evolving risk–reward dynamics.
Exits are driven by deterioration in the original investment thesis, adverse risk–reward shifts, or the emergence of superior opportunities elsewhere in the portfolio.
Suitable For
Investors seeking flexible, actively managed equity portfolios with the ability to adapt across market cycles, led by a stable and experienced fund management team.
Trailing Performance
| 1yr | 3yr | 5yr | Since Inception | |
|---|---|---|---|---|
| Alchemy Smart Alpha 250 AIF |
Performance as of: 30-Nov-25
Investment team
Hiren Ved | 5-star rated FM
CIO | 35 yrs Experience | 27 yrs at current firm
Past Experience: Prime Securities (Head - Equities), KR Choksey (Head of Research)
Hiren is a very seasoned investment professional, with close to 3 decades of investment experience. He co-founded Alchemy Capital Mgmt in 1999, helping build it into one of the leading PMS's in the country, on the back of long-term stability in the investment management team and strong alpha generation over time.
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