Equity

Opportunity to gain ownership

1

Companies With Predictable And Consistent Earnings

We like to bet with companies that have a predictable stream of earnings; operating in sectors that have a tailwind behind them.

The focus would be in identifying the next big trend by buying companies from sectors that are expanding rather than betting in a company which is growing in isolation.

We like to focus on sector leaders.

2

Small Companies

Even though big isn’t ugly for us small does remain beautiful. Though an entire portfolio cannot be set up based on small caps the underlying objective would be to focus on smaller capitalized companies.

3

Scalable Businesses.

The business has to be scalable in terms of both value and volume growth.

As an investor we should be able to assume that the entire scale of operations can be ramped up multiple times from what is presently being done.

4

Cash Flow

High growth with free cash flow is desired but isn’t the only yardstick on which investments will be based.

The differentiating factor between a free cash and a negative cash flow company is the urgency with which an investor has to exit the stock once growth slows down.

Negative cash flow companies need immediate attention during adverse times whereas for free cash flow companies the reaction time could be a little longer.

5

Growth

6

Dividend Payout

We like to see dividends as a statement of intent and not for the cash that comes into our bank account.

Dividends and taxes are compulsory payments and indicates that profits are for real because no one pays real cash on fake profits.

7

Return On Equity

Growth with high ROE is a potent combination. A high ROE indicates that the growth can be self sustaining without repeated capital dilutions.

Moreover, the ROE also indicates the level of efficiency with which the business is being.

8

Management

We don’t partner crooks no matter how remunerative the commercials might seem. However, both the management and business dynamics are important for an investor to make money.

What's our Buying Strategy?

Free Cash Flow Generator

Can grow 25%+ for long periods of time

Competitive Advantage over competitors (Moat)

Can generate High Return of Capital Employed

Low on Leverage

Smart and Ethical Management Team

Reasonable Valuations

What is our Selling Strategy?

We are not traders. We recommend an investment only if we believe the stock can atleast double in next 12-18 months.

We sell only if one of these things happens

Better Investment Opportunity
Story no longer Holds True
Extremely Overvalued
Long Term Breakdown in Stock, Sector or Market.

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