Moat Financial Services

About

Established in 2013, Moat is owned and controlled by its skilled and seasoned management team, who have worked together closely over decades with the same investment philosophy and a clear alignment of interest. It is a SEBI registered boutique portfolio manager. It was co-founded by Mr. Biju John and Mr. Suraj Nair. Moat administers and manages a portfolio of shares or equities of few great Indian businesses that has the ability to become really big by creating a barrier of entry or niche in the larger space. Their aim is to find small, efficient companies that have great competitive advantage run by visionary ambitious leaders that can really become the megatrend in india. It has a history of identifying several multi bagger investment ideas early.

Key staff

Biju John, Managing Director and CEO,  is a management professional with over two decades of experience in the capital markets and FMCG sector. With his extensive experience, he brings to the table his expertise in understanding the investor’s side of the story. Innovations and promotions, maintaining investor relations, management of accounts and taking a deep peek into the marketing aspects are his specializations

Suraj Nair, Director and CIO,  is a full-time equity investor who during the Lehman crisis, resigned his lucrative job, sold-off his apartment where he lived to mobilize capital to invest in equities. He brings with him over 15 years of wisdom in the Indian capital markets and is also the Co-founder and Executive Director of Moat Financial Services where he manages the funds and investment of a set of few chosen ones.

Fazal Ahmed, Director and COO, has over two decades of experience in the Indian Capital Markets. He is a member of the Cochin Stock Exchange, (currently CSBL) since 1997 and possesses a thorough understanding of the operations and compliance requirements of the equity markets. He is also the Operations and Principal Officer at Moat. Prior to joining Moat Financial Services, he has worked in the finance team of leading multinational companies in the Middle East.

Investment philosophy

Moat’s investment philosophy is designed to identify superior compounding growth stories which have the ability to deliver regularly rather than in bouts. We spot the undiscovered, hidden gems which can sustain a significantly higher Return on the capital employed (RoCE) compared to the Cost of capital (CoC) in the long-run, freeing up the excess cash flow for the business. This phenomenon not only makes these businesses resilient but also sets them a class apart. In our view, these companies are deemed worthy of the title “premium quality business”. 

We remain fixated on our aim of long-term wealth generation for all our clients. For this, we are on the constant hunt for companies that reinvest at least a portion of their excess cash flow back into the business to grow while increasing the returns for its shareholders. We stay committed to our investment picks for the long haul which gives the business time to create value and also allows us to reap the benefits of long-term compounding.

Media

Perspective of portfolio managers and their strategies on pandemic covid 19, April 24, 2020, PMS Bazaar, https://youtu.be/xUj2kPDLG7E 

In this video, Mr. Suraj Nair talks about portfolio construction.( The 60-40 allocation) They allocate 60% to well established companies and 40% to unidentified, unknown companies to generate alpha.

Moat investment philosophy, Nov 16, 2021, AIF and PMS Experts India, https://youtu.be/ty7MwTApPls  

In this video, Mr. Suraj Nair talks about how they allocate 60% to well established companies and 40% to unidentified, unknown companies to generate alpha. Also he gives an example that if an investor does not want to take excess risk and wants stable return, then he would give 100%  allocation to well established companies with moat. And if an investor wants to generate greater returns and is ok to take risk, then he would give 100% allocation to unidentified, unestablished companies which might become well established in future. When asked about how he would select those stocks he didn’t give any hint about the process they follow, but said that he would observe the products/ services which are visible daily, like the products household purchase etc.

From the interview, it can be seen that they are following a top down approach, as they are first considering government actions and the impact of that on any specific industry and picking a quality stock in that industry. Also with the kind of stocks they purchased like page industries, eicher motors, pidilite industries, we can say that they are growth oriented because they purchased them even at high prices. Also he talks about how the character of the investor and keeping emotions under control is important.