View on the Fund

Kotak Iconic offers a well-structured, multi-manager equity portfolio that combines 3–5 high-quality PMS strategies with smart-beta passive exposure, serving as a convenient alternative to building a DIY portfolio. It includes allocations to AMCs like Unifi, ENAM, White Oak, ValueQuest, and Abakkus—all of which are highly rated by us. While we prefer identifying & choosing high-quality managers customised to each specific investors requirements (and an FoF does compromise this level of customisation that is possible), many investors (especially those with a sub-5 cr portfolio) may find the ability to diversify across multiple high-quality PMS strategies at a lower 1 cr min quite attractive. The low-rating for the AMC investment team is not relevant for this fund, as fund management is outsourced to the various identified advisors.

Strategy

Multi-PMS Equity Blend

Fund's Strategy View

Kotak Iconic is a multi-manager equity AIF that combines a curated set of high-conviction PMS strategies with smart-beta passive exposures to create a single, diversified portfolio. The fund allocates capital across 3–5 actively managed strategies (50-100%) - selected through a rigorous in-house process - and supplements them with rule-based passive allocations (0-50%) such as momentum or low-volatility indices. This core-satellite approach enables the strategy to blend fundamental stock-picking with quantitative factor investing, while actively rebalancing to respond to market conditions and style shifts. The structure is designed to simplify access to top-tier equity managers and factor-based investing within one actively monitored framework.

Fund Performance

We refrain from evaluating the fund since it is yet to mature (less than 5 years).

View on AMC

While Kotak MF is a highly rated MF, Kotak's PMS business has some of the standard issues around MF-driven PMS businesses - primarily driven by a lack of team stability (Anshul Saighal who was with the firm for over a decade leaving in Nov-23). With a new investment team the value of the longer-term track reduces substantially, and we would wait for the new investment team to stabilise more before more actively recommending the fund.

AMC's Pedigree

Kotak is a renowned Indian financial brand with expertise in equities, including equity research, broking, investment banking, and MF businesses. While there are benefits to being part of a larger asset management house, the pedigree of an AMC-driven PMS may not compare to more investor-cum-promoter driven PMSs with stable investment teams and defined processes.

AMC Team

Anshul Saigal’s exit from Kotak PMS in November 2023, after over a decade at the helm, highlights the vulnerability of AMC-driven PMS platforms to key personnel risk, especially in the absence of significant fund manager ownership. He is replaced by Brijesh Ved in October 2024, who brings over 20 years of experience across reputed institutions such as Enam.

Investment Philosophy

Kotak PMS adheres to a value-driven investment philosophy, which has been implemented successfully due to the stability of the investment team. However, with a new investments team taking over the PMS, we will need to see if the investment philosophy changes.