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Motilal AMC Value Migration

Scheme Rating

IME Scheme Rating

The Scheme does not meet our selection criteria at this time

Wait for performance to improve: 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 Value at this time. We would wait for clearer signs of performance to improve before recommending the same.

IME Strategy Rating

Known Strategy: Oldest PMS strategies in the market with a strong long-term track record. Aims to benefit from long-term compounding effect on investment. Categorized as a large-cap strategy but has reasonable exposure to mid-cap stocks in the portfolio. Investing in good business run by great business managers also provide fund managers flexibility to invest across sectors & companies.

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 Motilal AMC Value Migration

Type: Large Cap | GARP | AUM (2095.9 cr) | Inc Date (18 Feb 2003)

Motilal Oswal Value- Investment Strategy

Focusing on good businesses that are run by great business managers for superior wealth creation

Motilal’s Value Strategy aims to benefit from the long term compounding effect on investments done in good businesses, run by great business managers for superior wealth creation.

Investment Philosophy 

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.

Once they have identified stocks that meet their strict QGLP criteria, Motilal aims to Sit Tight (by following a long-term buy-and-hold approach in concentrated stock portfolios.)

Value Migration Overview 

  • Inter-country Migration: The Indian IT and Pharma 
  • Inter-industry migration in same country: From Railways to Airlines
  • Inter-company migration in same industry: From Public sector to private sector in Indian Banks and Telecom spaces
  • One segment to another in the same company: Telecom has seen value migrating from Voice to Data

Trailing Performance

1yr 3yr 5yr Since Inception
Motilal AMC Value Migration 56.4 19 19.1 20
S&P BSE 500 TRI 39.5 19.5 19 18.5
Alpha over Broad Mkt BM 16.9 -0.5 0.1 1.5
Nifty 50 TRI 28.5 16.2 16.7
Alpha over Category BM 27.9 2.8 2.4

Performance as of: 28-Feb-23 | Inception Date: 18-Feb-03

Fund Managers

Shrey Loonker | 3-star rated FM

Fund Manager | 22 yrs Experience | 7 yrs at current firm

Past Experience: Nippon AMC (FM), Ernst & Young (Executive)

Shrey is a CA & CFA, with over a decades experience as a fund manager at Nippon AMC.

Fee Structure

Fee StructureFee
Fixed Fee Structure2.5
Variable Fee Structures1.5% fixed + 15% above 10% hurdle
Exit Fees1yr(2%)

AMC

AMC: Motilal Oswal AMC PMS (click link for detailed AMC review)

Not a top recommendation (at this time) due to weak recent performance: Motilal PMS comes with a very high level of pedigree. Co-founded by a highly-respected and pedigreed investor, Motilal has a number of advantages - stability of its core PMS investment team, very strong investment processes, a very clearly defined investment philosophy and the benefits of the backing of a strong broking & MF business. However, this strong pedigree has failed to reflect in the performance of the strategies (which have been weak, especially in recent years), which results in a lower 3-star rating for one of the more established PMS providers.

AMC Rating

3 of 5 stars

AMC Pedigree

5 of 5 stars

AMC Size

5 of 5 stars

Team Pedigree

5 of 5 stars

Inv Philosophy

5 of 5 stars

Performance

1 of 5 stars

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Note: PMS AMC & Scheme Reviews and Ratings are based on IME Capital’s Proprietary Review and Rating Methodology (read more here: AMC Rating & Scheme Ratings). These reflect the unbiased views of our central research team, based on our assessment of the investment value of these PMS/AIF strategies for our investors. We follow a highly stringent rating-criteria, where approximately 50% of PMS AMC’s & strategies would be rated 2-star or below (this is not meant to indicate that these funds are not investment-worthy, but that they do not currently fulfill the requirements we focus on for recommending funds to our investors — based on our internal views on the merit of the AMC/strategy relative to peers). Reviews & Ratings are primarily based on research of publicly available information (SEBI disclosures, PMS websites, PMS-aggregation platforms, webinar recording, media interviews etc.) and no explicit consent is required from AMCs for the same. While we endeavour to do further due-diligence via direct interactions with the investment teams of AMCs, this is typically restricted to AMC’s that meet our foundational fund selection criteria (reviews on lower-rated AMCs are often based solely on publicly available information). The views reflected in our Reviews & Ratings, are our independent views and may not be shared by the AMC’s and the investment teams. Please read detailed disclaimer for more.