About Company
Motilal Oswal Asset Management Company Limited
MOFSL was founded in 1987 with 2 employees as a sub-broking unit with their main focus of customer-first attitude, ethical and transparent business practices, and many more. Today Motilal is a diverse firm that is working on a range of financial products and services such as Private Wealth, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Home Finance, etc. Motilal has clients of retail customers, mutual funds, foreign institutional investors, financial institutions, corporate clients, etc. They have more than 44,00,000+ customers across the globe. They make every decision with solid research at present they have 25+ research analysts researching over 250 companies across 20 sectors.
Motilal Oswal India Excellence Fund – Mid to Mega – Series II
Fund Snapshot
| Tenure of the Fund: | 5 yrs + up to 2 yrs |
| Lock in (from final closing): | 18 months |
| Exit Load: | 18 – 24months – 3%, 24 – 36months – 2%, 36 – 48months – 1%, Nil thereafter |
| Commitment period: | 12 months from final closing |
| Initial drawdown: | 30% of capital commitment for non-SIP class |
| Final closing: | 12 months from initial closing |
| Number of Stocks: | 15-20 |
M-Q-G-L-P Investment Philosophy
Midsize
- Benefit of low-base
- Well-established track record
Quality
- Quality of business x Quality of management
- Stable business, preferably consumer facing
- Huge business opportunity
- Sustainable competitive advantage
- Healthy financials & ratios
Growth
- Revenue growth and market share gains
- Growth in margin & profitability
- Reliable high growth flows
Longevity
- Long-term relevance of business
- Extending competitive advantage period
- Sustenance of growth momentum
Price
- Reasonable valuation, relative to growth prospects
- High margin of safety
Portfolio Positioning
Manufacturing with focus on Exports
Contract manufacturing is booming, and production-linked incentive schemes are putting a lot of spotlight on this topic.
IT Services
Covid was instrumental in reducing the five-year investment in digitalisation to less than three years. Many businesses across all industries have been pushed to shift and implement digital processes, resulting in increased digitisation spending.
Cyclical Recovery theme
A wager on cyclical recoveries as well as a proxy for infrastructure and real estate investments.
Financials – Non-Lending
Insurance should be viewed as a multi-decadal growth industry. In this digital environment, capital market intermediaries and fintech are industries to watch.
What is Mid to Mega?
Crossover by the company from Midcap to Mega cap category
- Achievement of critical mass & scale
- Recognition by markets of the same
The above transition is mainly seen in companies who are
- Industry leaders
- Industry Tailwinds
- Value migration beneficiaries
Classifying companies into Mini, Mid & Mega
| Mega | Top 100 companies | Extensively researched |
| Mid | 101st to 300th Companies | Under researched, under owned |
| Mini | 301st to 400th Companies | Under researched, under owned |
Investment Framework
Technology Enablers
- India’s IT exports at USD 150 Bn+ > Saudi’s Oil Exports
- Impact of Covid – Digital enablement is the need of the hour
- Talent Pool – Unparalleled IT engineer pool of 45 lakh which is expected to go to ~100 lakh
- India Cost advantage continues to sustain – Boston to Bengaluru
Platform Companies
- B2C Stack Established: India’s stack is unique – Cheap Data + Free payment rail (UPI) + Aadhar
- B2B Stack Emerging GST + OCEN (Open Credit Enablement Network) + ONDC (Open Network for Digital Commerce)
- India not a big horizontally integrated market yet – Likes of Amazon, Flipkart are still a small part of overall consumption pie
- Digital Rupee – Power of Programmability
Why Now?
- Investing in tomorrow’s leaders by focusing on companies in the midst of the economic cycle: High Growth Prospects
- Mid-cap stocks have typically outperformed others over time. In the long term, the mid-cap category has outperformed the large-cap and small-cap segments.
- 5 Year Rolling Return Comparison: The present alpha levels of Nifty Midcap 150 above Nifty 100 are still at 3%, but mean reversion could push it up to 7%.
- There is still plenty of room for growth in the Nifty Midcap100 vs the Nifty50. The Nifty Midcap 100/Nifty 50 ratio is a strong signal for investing in mid-cap stocks. The Mid Cap ratio peaked at 2.0 in 2018, and current levels imply that there is still opportunity for mid-cap growth, given that the trend line has been expanding over time.
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Motilal Oswal Mid to Mega Strategy
Benchmark: BSE 500 TRI
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Review and compare fund returns against benchmark performance across different investment periods in a detailed tabular format.
Motilal Oswal Asset Management Company Limited - Portfolio Managers
| AUM(Cr.) | 1M | 3M | 6M | 1Y | 2Y | 3Y | 4Y | 5Y | Ince. | |
| Performance | ₹2286.13 | 4.17 | 31.50 | 15.36 | 8.64 | 10.19 | 24.43 | 24.29 | 15.10 | 23.47 |
| Benchmark | NA | 1.73 | 12.10 | -3.53 | -1.96 | 1.52 | 12.52 | 15.28 | 12.20 | 14.94 |
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The strategy focuses on identifying mid-cap companies that have achieved critical mass and are positioned to transition into "Mega cap" status. These companies are typically industry leaders benefiting from structural tailwinds or value migration, allowing them to scale significantly.
This is Motilal Oswal's proprietary framework stands for: Midsize: Focusing on the low-base effect of established mid-caps. Quality: Assessing both the business model and management integrity. Growth: Targeting high revenue margins and market share gains. Longevity: Ensuring the business remains relevant and competitive over decades. Price: Buying at a reasonable valuation with a high margin of safety.
The fund has a tenure of 5 years, which can be extended by up to 2 years. There is a formal lock-in period of 18 months from the date of final closing.
The exit load is tiered based on the duration of the investment: 18 – 24 months: 3% 24 – 36 months: 2% 36 – 48 months: 1% After 48 months: Nil
The fund is strategically positioned across four key themes: Manufacturing & Exports: Benefiting from PLI schemes. IT Services: Capitalizing on the global shift toward digitalization. Cyclical Recovery: Acting as a proxy for infrastructure and real estate growth. Financials (Non-Lending): Focusing on insurance, fintech, and capital market intermediaries.