Saurabh Mukherjea adds these stocks to portfolio, lists areas of caution
Marcellus Investment Managers has rejigged its portfolio over the last few weeks. Founder Saurabh Mukherjea discusses key changes in a chat with CNBC-TV18.
Marcellus Investment Managers has actively adjusted its portfolio in response to the evolving market, recently selling Amrutanjan Health Care and adding RHI Magnesita India. The firm also broadened its Little Champs portfolio with the inclusion of Cera Sanitaryware.
Saurabh Mukherjea, the founder of Marcellus Investment Managers, discussed these portfolio changes in an interview with CNBC-TV18.
On his recent investments, he spotlighted the success of Tata Group's retail firm, Trent, attributing the investment decision to the strong performance of its fashion brands, Zudio and West Side and grocery chain Star Bazaar.
"Over the last 10 weeks, we have built a position, and the results have been tremendous. The decision to invest in Trent is driven not only by the Zudio turnaround but also by the profitability of Star Bazaar in recent months," he said.
On September 29, Trent was included in the Nifty Next 50 Index, a sensitive index that tracks 50 large cap stocks that rank after the top 50 Nifty stocks (Nifty 50 index) in terms of free-float market capitalisation -- the portion of the share capital available for the public to trade in the stock market.
The Nifty Next 50 index companies are seen as strong contenders for their inclusion in the benchmark Nifty 50 index going ahead.
According to Nuvama Alternative & Quantitative Research, Trent's inclusion in the Nifty Next 50 index is likely to result in potential inflows of $44 million in the stock.
Mukherjea also reiterated confidence in HDFC Bank's long-term earnings growth, despite its stagnant returns in the past three years. He remains optimistic about the bank's future performance.
Mukherjea also addressed the challenges faced by V-Mart in the retail sector, particularly due to online competition. However, he is hopeful about the brand's revival during the festive and wedding seasons.
In the September quarter, V-Mart's quarterly net loss increased fivefold to ₹64.12 crore from ₹11.31 crore in September 2022.
The Gurugram-based chain of small-size hypermarkets has big expansion plans but brokerages such as Motilal Oswal are cautious about the stock. Motilal believes the company suffers from weak weak macro, intense competition and pressure in new segments -- Unlimited and LimeRoad. The brokerage firm downgraded the stock to Neutral after its latest quarter earnings.
Mukherjea emphasised the importance of patience and a deep understanding of companies in small-cap investing, especially when management teams are addressing issues.
In the financial sector, Mukherjea expressed caution about unsecured retail lending, particularly loans in the ₹10,000-20,000 range. He remains confident in the home loan segment, despite higher interest rates, but is wary of the unsecured lending sector.
As of October 31, 2023, Marcellus Investment Managers' total assets under management (AUM) were at $131.84 million.
For more details, watch the accompanying video
(Edited by : Shweta Mungre)
First Published: Nov 13, 2023 4:20 PM IST
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