Prosperity Wealth Management is an Indian investment firm that focuses on investing in high-quality publicly listed companies available at reasonable valuations. The companies they invest in operate on robust business models and are run by outstanding management teams. As investment managers, their goal is to generate returns that exceed a chosen benchmark index over the long run while ensuring that an adequate margin of safety is maintained for the capital deployed.
Prosperity Wealth Management is registered as a Portfolio Manager (vide registration number: INP000007049) with the Securities & Exchange Board of India. They currently operate Prosperity Discovery Fund under our portfolio management service.
Vasudev Gupta,, Founder, Chief Investment Officer – was previously a SEBI registered investment advisor. He holds a master’s degree in Innovation & Entrepreneurship from the Imperial College London. He specializes in evaluating equity investments in the manufacturing sector, given his 7+ years of expertise in this domain.
Investment philosophy (for the firm)
Prosperity Discovery portfolio – invests in 20 – 25 publicly listed companies, with a minimum allocation of 3% and a maximum allocation of 10% per company. Maximum sector holding in any one sector is limited to 25% of the total portfolio at cost. This is a multi cap fund investing in companies across small, mid, and large market capitalizations. The benchmark is an amalgamated index of Nifty 50: 34%, Nifty midcap 100: 33% and Nifty smallcap 100: 33%.
The fund is underpinned by a value investing framework & growth at a reasonable price philosophy.
Investing in companies demonstrating sustainable growth in top and bottom lines, strong balance sheet, low debt & a durable moat (sustainable competitive advantage) around the business.
Entry at bargain prices due to overcompensation of the markets to adverse events, undiscovered business value, or a turn-around story.
Exit when the company reaches a fair valuation or if there is a change in the initial investment thesis.
Investment in businesses run by ethical & competent professionals.
Capital deployed between a duration of 1 to 3 months.
In an article in Forbes India Marquee, July, 2021Vasudev tells that he firmly believes in the fundamental analysis and value investing methodology, which form the bedrock of Prosperity’s investment philosophy as well. In addition, the company undertakes a due-diligence process that involves taking into account criteria such as the (i) financial strength of a company, (ii) vision and quality of the management, (iii) macroeconomic environment, (iv) future outlook and growth potential, (v) economic moat protecting the business, and (vi) field research. Prosperity likes to invest in businesses that have a long runway for growth, are less leveraged, and most importantly are run by competent and trustworthy management teams
Prepared by – Bhanu Prakash, March 2023