Scheme Rating
IME Scheme Rating
Reasonable Investment Option: Sundaram SELF is a reasonable investment option amongst Flexi-cap funds, having a long track record and benefiting from Sundaram’s niche of South-based small&mid-cap companies.
IME Strategy Rating
Focused Strategy on core themes: Tightly defined strategy in terms of focus themes, asset-light, and free cash-generating business. Strategy fairly closed followed in actual practice. A moderate level of diversification (20-25 stocks) is reasonable given the higher volatility of mid-caps. The strategy focuses on themes – consumer discretionary, financial services, chemicals, and cement. The strategy has matured successfully with its flexi-cap strategy, focusing on mid and small-cap companies positioned to transition into the large and mid-cap segments.
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 Sundaram Alternates S.E.L.F
Investment Philosophy
Sundaram PMS’s SELF (Sundaram Emerging Leadership Fund) strategy is a mid-cap (stocks less than 50,000 cr mkt cap) with a moderate level of concentration (20-25 stocks). It seeks to invest in companies that have the potential to transition from small-cap > mid-cap > large-cap, with a focus on asset-light and high cash flow generating businesses. The strategy also focuses on 4 specific themes – consumer discretionary, financial services, chemicals & cement.
Sundaram self aims to generate capital appreciation with investment in mid and small cap companies across sectors with around 25 stocks by following its “3Q” approach to stock selection:
- Quality of business: Scalability, self sustaining business models, Differentiating factors in business
- Quality of financials: Ability to double earnings in 4-5 years, min-ROIC of 15%, OCF/EBITDA>50%, D/E< 0.5x.
- Quality of Management: Track record, vision, high sustainable growth, identifying and investing in profitable opportunities, good corporate governance
Trailing Performance
1yr | 3yr | 5yr | Since Inception | |
---|---|---|---|---|
Sundaram Alternates S.E.L.F | 35.8 | 11.7 | 22.9 | 18.2 |
S&P BSE 500 TRI | 41.1 | 18.4 | 22.4 | 14 |
Alpha over Broad Mkt BM | -5.3 | -6.7 | 0.5 | 4.2 |
Nifty 500 | 40.2 | 17.2 | 21 | |
Alpha over Category BM | -4.4 | -5.5 | 1.9 |
Performance as of: 30-Sep-24 | Inception Date: 01-Jun-10
Fund Managers
Madanagopal Ramu | 3-star rated FM
Fund Manager | 19 yrs Experience | 7 yrs at current firm
Past Experience: Centrum (Analyst), PFC (Project Finance)
Having joined Sundaram as a research analyst in 2010, Madangopal went on to become the Head of Research and co-manager of a number of the Sundaram AMC funds. He joined the PMS division in 2018.
Fee Structure
Fee Structure | Fee |
---|---|
Fixed Fee Structure | 2.5 |
Variable Fee Structures | 1.5% fixed + 20% above 10% hurdle |
Exit Fees | 1yr(1%) |
AMC
AMC: Sundaram Alternates PMS (click link for detailed AMC review)
Not a top recommendation due to being an MF-driven PMS: Sundaram Alternates PMS is a mature PMS provider and with a known specialisation in small-and-mid caps. While it is slightly more differentiated than some of its larger AMC-founded PMS peers, it does suffer from MF-promoted PMS ailments (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), which is why we typically prefer owner-managed PMS providers instead. However, it does have its own positives- (a) long-track records of core portfolios -- each of which has over a decade of performance (b) differentiation in terms of mid-and-small caps (c) more PMS-like strategies - higher concentrations & differentiated portfolios.
AMC Rating
AMC Pedigree
AMC Size
Team Pedigree
Inv Philosophy
Performance
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