Motilal AMC Next Trillion Dollar Opportunity
Motilal Oswal AMC PMS | Equity | | PMSIME's View on Motilal AMC Next Trillion Dollar Opportunity
Strategy
Investment Fund
While Motilal has all the required credentials for a strong PMS strategy, continued underperformance in recent years with limited signs of strategies to turn around the same, lead to us not recommending Motilal NTDOP at this time. We would wait for clearer signs of performance to improve before recommending the same.
Fund's Strategy View
Follows a fair broad mandate by investing in sectors contributing next trillion dollars of GDP growth. This is a fairly broad definition, that allows fund managers the flexibility to switch between sectors based on their views. NTDOP is a multi-cap portfolio (though with a higher share of large-caps than other Motilal PMS strategies), which helps reduce return volatility compared to the other more mid-cap oriented Moti strategies. There is a clearly defined investment philosophy of long-term investing in high-quality companies that meet Motilal's QGLP Philosophy (Quality, Growth, Longevity, Price).
Fund Performance
The fund has underperformed peers in the last 5yr trailing returns. In terms of longer-term annual performance, performance has been consistent, with the fund having outperformed it's benchmark in over 60% of annual calendar years.
IME's View on Motilal Oswal AMC PMS
View on AMC
Motilal PMS, co-founded by a respected investor, offers strong pedigree, robust processes, and stability backed by its broking and mutual fund arms. However, strategy performance has been weak in recent years amid significant churn in the core investment team. While recent results show signs of improvement, a sustained turnaround under the new team remains to be seen.
AMC's Pedigree
Motilal PMS has a strong investment pedigree in India, thanks to co-founder Ramdeo Agarwal's philosophy and processes.
AMC Team
Motilal has experienced significant turnover in its investment team in recent years. CIO Manish Sonthalia and several other team members have left. Prateek Agarwal has replaced Manish and is working to improve underperforming PMS strategies. It is too soon to assess the impact of Prateek's changes on Motilal's investment approach and performance.
Investment Philosophy
Motilal Oswal's QGLP investment philosophy focuses on identifying Quality businesses with strong fundamentals and management, possessing robust Growth potential in earnings and ROE. They prioritize the Longevity of these companies' competitive advantages, ensuring sustained performance. Finally, the "P" emphasizes buying these exceptional businesses at a Reasonable Price to ensure a margin of safety, aiming for long-term wealth creation through a disciplined approach. Motilal follows a long-term investment philosophy focused on high-quality companies meeting their QGLP criteria for over 20 years, resulting in consistent and attractive returns with minimal style drift.
Investment Philosophy
Motilal’s Next Trillion-Dollar Opportunity Fund (NTDOP) is a multi-cap portfolio that aims to invest in the top companies from sectors that stand to contribute the most to the next trillion dollars of GDP growth. Motilal has a very clearly defined investment philosophy of long-term investing in high quality companies that meet their QGLP investment criteria. They have followed this strategy consistently for over 2 decades, with limited style drift. The QGLP Framework:- Quality of the Business and Quality of the Management: Stable businesses preferable consumer facing, with huge business opportunity and sustainable competitive advantages. Businesses run by competent management.
- Growth in Earnings: Driven by volume growth, price growth, mix change, operating and financial leverage.
- Longevity (of Quality and Growth): Dictated by long-term relevance of the business, extending competitive advantage period and sustenance of growth momentum.
- Price: Reasonable valuation, relative to quality and growth prospects with high margin of safety.
STRATEGY
Motilal's NTDOP focuses on the next trillion-dollar opportunity in India. The strategy aims to benefit from the exponential increase in discretionary spending on the back of doubling real GDP per capita. Key themes the strategy focuses on: housing, auto, consumer durables, entertainment, travel, and premium wear among others. Motilal NTDOP is positioned to invest in companies that fall in the 'sweet spot', defined as companies with a market cap between 3500-30000 Cr. They believe these are companies that are under-researched, under-owned and have high growth prospects with a certain demonstrated management history. QGLP Framework The framework is built on the premise of identifying great businesses (defined as longevity of quality and growth) and buying at a reasonable valuation. By rigorously following the QGLP approach, Motilal ensures that they only invest in high-quality businesses with attractive growth prospects, without paying too high a price.Trailing Performance
| 1yr | 3yr | 5yr | Since Inception | |
|---|---|---|---|---|
| Motilal AMC Next Trillion Dollar Opportunity | -12.9 | 12.4 | 15.5 | 14.4 |
| S&P BSE 500 | -6.6 | 14.7 | 19.2 | 11.9 |
| Alpha over Broad Mkt BM | -6.3 | -2.3 | -3.7 | 2.5 |
Performance as of: 30-Sep-25 | Inception Date: 03-Aug-07 | Performance are post-fees, pre-taxes. Global funds denominated in USD or fund currency.
Investment team
Prateek Agrawal | 5-star rated FM
Executive Director | 31 yrs Experience | 3 yrs at current firm
Past Experience: BoI AXA MF (Head of Equity), BNP Paribas MF (Head of Equity), SBI Capital Markets (Head of Research)
Prateek is the CEO of Motilal Oswal AMC. He has over 3 decades of experience in fund management and research, having worked in senior positions in BoI AXA MF, BNP Paribas MF, SBI Capital Markets and ASK. In his last stint at ASK, he was spearheaded the growth of ASK PMS over this period.
Abhishek Anand | 3-star rated FM
Fund Manager | 22 yrs Experience | 2 yrs at current firm
Past Experience: Centrum Wealth Management, Centrum Broking, SBI Capital Markets, Dun & Bradstreet, CMIE
Abhishek Anand has 20+ years of experience with 8 years in institutional equity research covering sectors such as Telecom, Media, IT & Consumer. He has won the Starmine Top Analyst Award for 2011-12 and 2012-13 by Thomson Reuters. His previous assignments were with the institutional research division of SBI Capital Markets, Dun & Bradstreet, and CMIE.
Rakesh Tarway | 3-star rated FM
Fund Manager | 20 yrs Experience | 7 yrs at current firm
Past Experience: Reliance Securities (Head of Research), Motilal Securities (Head of Research), HSBC InvestDirect (Analyst)
Rakesh is a seasoned equity research professional, with a focus on identifying emerging businesses in the small & mid-cap sectors.
Vaibhav Agarwal | 1-star rated FM
Fund Manager | 14 yrs Experience | 4 yrs at current firm
Past Experience: Analyst bank loan Ratings(Crisil)
Vaibhav Agrwal is the founder of Teji Mandi, which is a platform aimed at helping retail investors in india navigate the volatility of the markets through affordable and quality advisory. He has managed a proprietary pms and has over a decade experience in stock picking and generating index-beating returns.
