InCred Small and Midcap PMS

Business and Market Cycle Framework

RECOVERY

Business is doing well but the market has discounted most of the positives—time correction. Investor sentiment is more optimistic.

BOOM

Business and the market are doing well – Investors only focused on returns and ignore the risk associated with generating the returns. Prepare yourself for the next cycle; try and minimize decision-making.

BUST

Business and Markets not doing well. Events that are global or local start to unravel. Investors think about risk and not returns.

SLOWDOWN

Business is not doing well but the market has started to discount the recovery. Investors are still risk-averse.

What do they look for in a company?

Capital Allocation Skills

• Management teams' ability to allocate incremental capital to enhance shareholder returns.
• Over the long term, the ability to earn Return on Invested Capital in excess of cost of capital.

Superior Management

• We look for owner-operator management teams that are aligned to minority shareholder interest.
• Key man risk is high and hence management team evaluation is the key.

Potential for High Growth

• We look for companies that are in high-growth industries and have a large total addressable market.
• The company should be able to gain and sustain market share.

Small In Size

Companies small in size have the potential to grow revenues, profits, and cash flows and generate superiorreturn on capital.

Longevity in Earnings Growth

The growth in earnings should be sustainable over long periods of time and across business cycles, cash flows should be durable.

Reasonable Valuations

Companies should be available at a reasonable price and should have enough margin ofsafety.

Risk Management

Market Capitalization

Fund rarely invests in companiesthat have a market capitalization less than 1000 Crs. The average market capitalization of companies in the fund is 6900 Cr.

Daily Average Volume

The purchase orsale of the stock must be executed within five days, ensuring that the traded volume does not exceed 30% of the stock's daily average volume. This helps to avoid

abrupt price spikes or drops.

Leverage Parameters

Excluding financials, the fund aims to invest in companies that have low Net Debt. Small and MidCap PMS has an average Debt/Equity of 0.01 and 15 companies are Net Debt free. Average Net Debt to EBITDA is 0.5.

Top 10 Holdings

Sector Analysis

About The Fund Manager

Aditya Sood, Fund Manager, InCred Asset Management

• Overall investment experience of 20 years in equity markets, out of which 18 years were in fund management.
• Global experience managing emerging market equities in the United Kingdom.
• Formerly headed the investment function of ICICI Prudential PMS managing assets of over INR 4,000 crores
• He combines a philosophy of focusing on ‘Return of Capital” along with “Return on Capital” and picked a high point in the market to close his PMS at ICICI Prudential and return capital to investors with a handsome profit
• Also spearheaded small/mid-cap research at ICICI Prudential 
• Funds managed—InCred Multicap, small and midcap Portfolio, IVGF-1 and EBF.

Investing With a 360° Perspective

Markets don’t move in straight lines, and neither do we. At AltPort, we combine macro understanding, micro insights, and disciplined execution to curate portfolios that stand firm across cycles. If you want an approach that sees the full picture—not just the trends—this is your advantage.