|Fund name||Asset Class||License|
|Perpetuity Funds||Equities||SEBI AIF Cat 3|
About the AMC
- Perpetuity Ventures was started by Deepali Singhal in August 2017
- Key staff : Abhishek Singhal , Managing Partner and Chief Investment Officer
Dion Stéfan Büchner , Global Healthcare Advisor
- Deepali Singhal : Deepali has worked with organisations such as TLG India, Yum Restaurants, Motorola and GE Motors. She is a Chartered Accountant, Cost and Works Accountant (rank holder) and BCom (Honors).
Abhishek Singhal: Abhishek is ex-head of Asian Healthcare Research at Macquarie Capital Securities leading the coverage for almost a decade. He has a diverse experience in the healthcare space spanning Industry, Buy side and the Sell Side. His Healthcare coverage has been ranked several times among the Top 3 in India by II (Institutional Investor survey), Asia Money Poll and Thomson Reuters.
Dion Stefan Buchner: Dion brings on table combined clinical/scientific skills acquired as pathologist, with ten years’ experience as financial analyst, at J.P. Morgan Securities and Fidelity Investments.
Investment Philosophy (for firm)
Their Investment Philosophy emphasizes on identifying businesses with sustainable advantage over competition, reliable management with strong track record and attractive valuation.
- Identifying Stocks: Earnings growth with free cash generation core to our selection process.
- Growth i.e. Sustainable (IP driven, high entry barriers) & Predictable (identifiable demand / supply drivers)
- Due Diligence: “Mud on the Boot” strategy emphasizing on-ground research for insights.
- Assessing Valuations : What’s in the price analysis to help identify valuation dislocation
- Portfolio Constructions : 12-18 stock high conviction concentrated portfolio
- Monitor: Constant monitoring to help test investment thesis on track.
They avoid pitfalls like:
- Valuations way ahead of fundamentals.
- Poor Corporate Governance
- Herd Behaviour / Hot Picks
- Derivative Products
- Low Promotor Holding/Unstable Management
- High Leverage Companies.
Absolute Return Recipe
Perpetuity Ventures LLP is into fund management with focus on investments in Indian equities market. Promoted by people with rich experience in the financial services and core industry sectors, it is Investment Manager to SEBI Registered Category III Alternative Investment Fund.
Perpetuity Ventures has launched its maiden fund. The Fund would be focused on creating value for its investors by investing in a strong portfolio of companies which are driven by underlying business growth and fundamentals over a period of at least 2-3 years holding period. Towards this end, Perpetuity Ventures will follow a very disciplined and research driven approach to investing.
Health Care Focused: 40-60% of the portfolio in Healthcare sector (including Pharma) Rest in sectors driven by demographic changes and household spending.
Demography Driven: India’s demography presents opportunities in consumer-spending driven and under-served areas such as healthcare, durables, infrastructure etc.
Concentrated Portfolio: Well researched 12-18 stocks backed by rigorous due diligence.
Quality Conscious: Focus on quality of business, quality of earnings and quality of management.
Restrictions: No single stock to have more than 10% weightage Market cap agnostic.
India Advantage: India offers the best growth opportunity globally driven by an improving macro-economic environment, political stability and reform.
Invest with a long term view: To create absolute return despite the risk of any near-term relative under-performance. They look to invest in businesses which they deeply understand, and not just “Stocks”.
Firm’s Edge in Healthcare
1) Rigorous analysis of company-fundamentals in sector context
- Maintain full earning models, market models and comparative (consensus) valuation book.
- Quarterly Management meetings – leverage long term relationships – R & D, BD, IR
- Focus on discrepancies with Consensus numbers, anticipate consensus movement.
2) Leverage experience / insight
- Attending key scientific conferences (ACC, ADA, ASCO, AHA, and ASH).
- Leverage relationships with a network of key opinion leaders, primary investigators, and professional societies.
- Track regulatory environment (FDA, EMEA, MHLW, SFDA …)
- Global and Indian IP issues Clinical practice in India Vs. Developed Markets
3) Leverage relationships with career healthcare analyst around the world
- Well researched 12-18 stocks backed by rigorous due diligence.
4) In-house proprietary quantitative models, help track the companies better
- Focus helps gauging market sentiments leading to timely exploitation of opportunities.
Q1) How are you looking at the pharma space because this COVID outbreak could be a big opportunity for the Indian pharma sector?
Q2) What should you look for in healthcare stocks if you’re an investor willing to handle what’s likely to be a more volatile market for the industry?
Q3) What is a process to generate alpha in equity investing?
Peer review – Shivani Kadam
Date – 11th May 2020.