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Axis AMC Core & Satellite

Scheme Rating

IME Scheme Rating

The Scheme does not meet our selection criteria at this time

Investment Option: Can wait it out as it is not recommended at this stage as the portfolio is young, the value of the strategy loose and don’t know of the implementation of the strategy.

IME Strategy Rating

Weak Strategy Philosophy: No clearly defined investment philosophy at the PMS level, not sure how strictly the strategy is being implemented.

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 Axis AMC Core & Satellite

Type: Large & Midcap | GARP | AUM (135.4 cr) | Inc Date (11 Nov 2019)

Axis Core & Satellite- Investment Strategy

Axis’s Core & Satellite strategy aims to create a portfolio that has a blend of 2 investing styles: – Core: fundamentally strong businesses with a strong brand – Satellite: cyclical businesses with a strong track record of superior capital allocation.

Investment Thesis

Core Allocation: Following concept of Brand investing (50-70%) by identifying- 

Businesses having strong BRAND presence, steady compounder which are held for long term (5 years+). Core also provides stability in the portfolio as stock are relatively low beta in nature. 

Satellite Allocation: Based on the concept of Efficient Capital Allocators (30%-50%)

Identifying companies having a track record of superior capital allocation, identifying stocks which have element of cyclicality in earnings and are currently mispriced opportunities. Satellite allocation can act as a return ‘kicker’ and stocks held with medium term view (18-24 months). 

 Investment Process

Creating an Investment universe by following a Quantitative and Qualitative screeners . The investment universe is created by firstly looking for a Brand Universe and Capital allocators universe. Brand universe futher on utilises a Brand Filter.

Quantitative Screeners includes the Brand universe by using the following filters: 

  • Brand Filter– significant brand investment (advertising, marketing, communication, royalty, R&D expenses). As well as growth> GDP Growth and Returns> Cost of capital. 
  • Past Capital Allocation Behavior– on the basis of non-finance – focus on positive cash accruals which covers investment needs over sustained period. As well as on the basis of Finance- capital deployed to efficient use, generate superior returns with an eye on risk. 

Qualitative Screeners includes monitoring the following: 

Management Interaction, Competition analysis, industry visits, margin of safety analysis, leverage Axis/Schroders capabilities 

Trailing Performance

1yr 3yr 5yr Since Inception
Axis AMC Core & Satellite 26.9 15 15.5
S&P BSE 500 TRI 34.7 18 16.5
Alpha over Broad Mkt BM -7.8 -3 -1
Nifty 500 33.8 16.9
Alpha over Category BM -6.9 -1.9

Performance as of: 31-May-24 | Inception Date: 11-Nov-19

Fund Managers

Hitesh Zaveri | 4-star rated FM

Head – Listed Equity Alternatives | 24 yrs Experience | 2 yrs at current firm

Past Experience: Plutus Capital, OSF Capital, Birla AMC, Enam AMC

Hitesh Zaveri joined Axis AMC in 2022 as SVP & Head – Listed Equity Alternatives. He is responsible for managing the Axis PMS portfolios along with relevant CAT-3 AIF strategies. Hitesh has over 25 years of experience in portfolio management, investment banking and equity research. Prior to joining Axis AMC, he served as Head of Investments in the PMS business at Aditya Birla Mutual Fund. He has pursued his MBA from Mumbai University, and has also completed a few programs from the Harvard Business School and from The Wharton School.

Fee Structure

Fee StructureFee
Fixed Fee Structure2.5
Variable Fee Structures1.5% fixed + 20% above 12% hurdle
Exit Fees1yr (3%), 2yr (2%), 3yr (1%)

AMC

AMC: Axis AMC PMS (click link for detailed AMC review)

Not a top recommendation due to being an AMC-driven PMS: Axis AMC PMS suffers from the common ailments of large AMC driven PMS houses (PMS as an add-on instead of a clearly segregated business unit, churn in the investment team, a lack of skin in the game for the CIO and typically loosely defined investment philosophies). While the distribution strengths of the AMC can help the PMS scale and there are benefits of research access, most AMC driven PMS's cannot compare to strong CIO-cum-founder driven PMS houses.

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

1 of 5 stars

Performance

2 of 5 stars

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