November 2022
Tata Small Cap Fund focuses on buying businesses which can grow over the next 3-4 years along with focusing on strong balance sheet and available at reasonable valuations. Given the high volatility and uncertainty associated with small caps, its imperative to make the right picks.
Since inception, Tata Small Cap Fund has been able to reduce capital drawdowns vis-à-vis the benchmark index. The fund aims to deliver risk adjusted returns focusing on stocks available at reasonable valuations in this segment.
PORTFOLIO & PERFORMANCE
Philosophy: Our investment philosophy is to identify companies which can grow in terms of profitability and cash flows with strong balance sheets where business can surprise the markets over a period of time in terms of delivery of earnings which in turn can lead to rerating of valuations
Performance: The recent performance is a result of thorough research and due diligence. The companies in the portfolio have been delivering strong surprises on profitability and growth even in a tough environment and hence rerating of valuations as expected is high. Some factors which have been common across our winners—Increasing top line, Decreasing costs, Zero or very low leverage,
decent free cash flows, working capital management, Lower interest costs, All time high operating margins and high ROE/ROCE levels.
Way Ahead: We have invested in select businesses which have a combination of high growth in earnings along with free cash and trading at reasonable valuations. We are optimistic on the portfolio performance in terms of earnings growth going forward and believe that the portfolio is well positioned for the next 2-3 years.
FUND SNAPSHOT
Benchmark Nifty Smallcap 250 TRI
Monthly Average AUM Rs. 2623.36 Crores
Inception Date November 12, 2018
Expense Ratio Direct-0.29, Regular- 2.20
Fund Manager Chandraprakash Padiyar
Assistant Fund Manager Satish Chandra Mishra
Options Growth & IDCW
Weightage of top 10 37.18