ALCHEMY ALTERNATIVE INVESTMENT TRUST

Fund Snapshot

Overview of Schemes under the Trust

Instead of acting as a standalone fund, the Trust acts as an umbrella vehicle that spawns specific, focused investment series over time. Prominent AIF schemes launched under this trust include:

• Alchemy Emerging Leaders of Tomorrow (Series 1 & 2): High-conviction mid-and-small-cap strategies targeting fast-growing, agile multi-sector companies capitalizing on structural changes in the Indian economy.

• Alchemy Leaders of Tomorrow (Series 3): Closed-ended, multi-cap strategies agnostic to sector bounds, prioritizing businesses displaying robust governance, digital adoption, and defensive cash-flow capabilities.

• Alchemy Long Term Ventures Fund – Series 3: A unique, sector-agnostic crossover strategy blending listed public small-to-mid-cap equities with up to 35% exposure in private/unlisted entities at growth inflection points.

Core Investment Philosophy

Across all the schemes launched under the Alchemy Alternative Investment Trust, the investment manager utilizes a highly disciplined, institutional equity playbook:

I. Crossover Positioning & Flexi-Cap Adaptability

Category-III AIF frameworks grant the investment committee structural latitude that ordinary mutual funds do not enjoy. The trust allocates capital seamlessly across unlisted pre-IPO companies, newly listed entities, and small-to-mid-cap multi-bagger prospects, following a growth-at-a-reasonable-price (GARP) template.

II. Bottom-Up Forensic Filtering

The investment team applies rigorous qualitative and quantitative filters to weed out underlying structural risks:

• The Moat Vetting: Testing the company's relative market power, capital efficiency metrics, and working capital cycles.

• The Quality Filter: Conducting exhaustive corporate governance and management alignment checks to secure long-term capital compounding.

III. Thematic Sector Allocations

Rather than mirroring stock indices, the strategies concentrate heavy bets on structural macroeconomic shifts driving the Indian ecosystem. This includes deep thematic allocations into fields such as:

• High-precision contract manufacturing and domestic defense networks.

• Technological transformations including Artificial Intelligence, semiconductors, and hyperscale data center logistics.

• Green mobility infrastructure and biotechnology.

Process

Ideation and Universe Screening

At Alchemy, the investment process begins with a broad universe of over 500 companies. This universe is systematically narrowed down to approximately 250 investible companies using clearly defined parameters. These include consistent growth in revenues and profits, minimum return on capital employed (ROCE) thresholds, prudent leverage levels, strong conversion of EBITDA into cash flows, and adherence to sound corporate governance practices.

Management Interaction and Ecosystem Assessment

Once companies with clear competitive advantages and scalable business models are identified, the investment team engages directly with senior management. These interactions focus on understanding business strategy, growth roadmaps, and capital allocation discipline.
To gain a well-rounded perspective, the team also interacts with the wider business ecosystem—industry experts, suppliers, dealers, and customers wherever feasible. This multi-angle assessment helps build a deeper, more holistic understanding of the company and its operating environment.

In-Depth Financial Analysis

Following the initial evaluation, the team undertakes a detailed financial analysis. Historical performance and forward-looking financial models are developed, with rigorous internal discussions around key variables and value drivers. Sensitivity analyses are conducted to assess “what-if” scenarios and determine the company’s risk-reward profile.
The experience and judgment of the investment team, led by the CIO, play a crucial role in evaluating whether insights from management interactions and industry analysis align with Alchemy’s investment philosophy. Companies that meet both quantitative and qualitative criteria, and demonstrate an attractive risk-return equation, are included in Alchemy’s investment universe.

Continuous Monitoring and Risk Assessment

Alchemy embeds the principle of “better safe than sorry” into its investment framework. Portfolio companies are reviewed regularly to track performance and reassess the original investment thesis. The team continuously evaluates the impact of internal developments and external factors to determine whether corrective action is required.

Exit Philosophy and Portfolio Discipline

Alchemy does not operate with predefined exit prices or fixed return targets. Instead, it follows a disciplined philosophy of allowing strong performers to compound while exiting weaker positions when necessary.
A stock may be sold under three key circumstances:

• When the original investment thesis no longer holds due to external changes or company-specific actions
• When portfolio rebalancing is required to manage position sizes
• When the risk-reward equation turns unfavourable and superior alternatives emerge

Backed by a long-term track record and a strong foundation of research-led decision-making, Alchemy remains committed to continuous learning and adaptation. This ensures robust investment processes that stay aligned with evolving market realities and consistently aim to meet investor expectations.