Avendus Absolute Return Fund AIF

Avendus AIF | Alternatives | | AIF

IME's View on Avendus Absolute Return Fund AIF

Strategy

Pedigreed long-short fund in India

Investment Fund

The fund has been closed given the departure of the entire investment team.

Fund's Strategy View

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 Avendus AIF

View on AMC

Avendus AIF had built a stong alternatives long-short funds business. However, given the departure of the entire investments team (spear-headed by Andrew Holland & Vaibhav Sanghvi) and the shutting down of the funds, the future outlook on this business is uncertain.

AMC's Pedigree

We will wait to see Avendus's strategy on the AIF business, before evaluating the AMC.

AMC Team

We will need to wait for the new team to join to evaluate the AIF.

Investment Philosophy

Avendus Capital’s Absolute Return Fund aims to produce absolute returns with low volatility, across different market scenarios. This portfolio has a low correlation with conventional asset classes.

Key Aspects of Long Ideas

Fundamental Parameters: Robust Business Model, Corporate governance, earnings and balance sheet quality, and valuation pattern
Thematic Parameters: Changing consumer behaviour, market leadership, regulatory and tech changes and structural sectoral changes
Technical Parameters: Market-cap, institutional holding, liquidity, technical charts, event-driven, and tactical trades

Key Aspects of Sell Ideas

Catalyst: technical factors, management changes, financial reporting
Structural positioning: weak competitive position, structurally endangered and markets, political risk, and corporate governance
Valuation: trading on premium multiples, and share price above target price
Market Capitalizations: > Rs 750Crs.
Key Company Features: Filter out businesses which may not create EVA on a sustainable basis, with a global presence in B2C, conglomerates, global commodities, ESG issues, PSUs, difficult to understand, and not scalable

Risk Management

Gross Exposure: Max 200%
Long and short position: Max 10%
Long only- Stop loss limits: 20% Review limit
Review: 4% daily and 10% monthly loss review limit

Attractive Investment Philosophy run by Highly Respected Long-Short team in India A long-short strategy has the ability to provide attractive absolute returns across market conditions, with a low correlation to other asset classes, making them an attractive addition to the portfolio. However, this requires a unique skill set in order to execute well, and the Avendus team is one of the few long-short strategies run by a team with a successful track record of managing absolute return strategies. Robust & Clearly Defined Risk-Control Mechanisms There are clearly defined risk-control mechanisms, that include limits on single securities (10%), sector exposure (25%), min hedges (30%), stop loss limits (at stock and fund levels). Net-Long Bias The strategy has historically shown a net-long bias. This bias, relative to other a few Long-Short options in India, is conservative in nature and could be analogous to a hybrid fund.

Trailing Performance

	1yr	3yr	5yr	Since Inception
Avendus Absolute Return Fund AIF

Performance as of: 30-Sep-25 | Inception Date: 10-Mar-17 | Performance are post-fees, pre-taxes. Global funds denominated in USD or fund currency.