Markets backed by sustainable, long-term growth: ASK Investment Managers

Indore, September 2024: Blackstone-backed ASK Investment Managers,one of India’s largest asset and wealth managementcompanies,believes the current market rally is backed by sustainable, long-termeconomic growth positioning India for multi-year growth, driven by the robust expectations of strong corporate performance, underscored by the recent conclusion of the Q1FY25 earnings season by Indian corporates.

“Markets are at a juncture where global economies are defying recession so far while Indian growth rates continue to be decent. We believe a particular style of investing may not work, but a high focus will be on bottom-up stock ideation based on secular long-term businesses with execution prowess. While markets may seem to be quoting at a premium today, they are backed by strong, sustainable long-period growth,” said Sumit Jain, Deputy CIO, ASK Investment Managers (ASK), in an engaging discussion with the media in Indore today.

Mr. Jain added, “Current earnings multiples and valuations are backed by superior margins and superior capital efficiencies. Balance sheets of stakeholders are much better than in the past, so a comparison with the past may not be the right thing.”

“Another important trend seen in the quarterly results has been the converging performance of corporates across market caps. Operating profit (ex-Oil and Gas), across the market cap, has been in the range of 10-16%, with a small cap at the lower range of 10%. We believe divergence in performance across market caps and ownerships should reduce going forward,” Mr Jain added.

He was accompanied by Nimesh Mehta, Director and Head,Sales and Products, ASK Investment Managers. ASK is looking to tap into Madhya Pradesh’s growing retail investor base, which accounts for 5.23% of total retail investors but has grown as much as 37.25% in the last year, as per BSE data. Over the last 5 years, Indore’s MF AUM has grown at a CAGR of 23% to Rs 26,297 lakh crore as per AMFI data.

• ASK’s total AUM in Indorehas grown 42 % CAGR over the same period and stands at Rs 191cr
• Indore’s share in ASK’s Portfolio Management Services (PMS) AUM has also grown from 0.21% to 0.62% in the last 5 years

Nimesh Mehta said, “Indore is a focus market for ASK Investment Managers. We’ve seen a consistent rise in our AUM here over the past 5 years and we look forward to making further inroads with the fast-growing investor segment here. We believe that our investment solutions and investment philosophy focusing on long-term growth resonates well with our growing client base here.”

As an investment philosophy, ASK Investment Managers Limitedfocuses on long-term opportunities. Investments are focused on businesses that have secular opportunities and are run by management that hasexecution prowess. Domestic-oriented businesses in manufacturing, automation, defence, energy transition, discretionary consumption,circular economy,etc., offer multi-year growth opportunities.