The month of September was a bit choppy, but equity markets still managed to end in the green. But PMS strategies weren’t able to take advantage of a rallying market and witnessed a rather weak month.

In September, the 346 PMS strategies tracked managed to deliver 1.43% on average. The benchmark Nifty recorded a 2% return in the month, while the broader market BSE 500 TRI gave 2.11% in September.

The markets saw selling from FIIs to the tune of Rs 26,692 crore in the cash market in the month, even as DIIs net bought Rs 20,312 crore. 

It was a modest month for PMS strategies as only 114 of the 346 (less than a third) schemes delivered more than the Nifty TRI. The figure was lower when compared to the BSE 500 TRI as only 106 schemes outperformed the benchmark in September. 

The top performers’ chart consisted of a mix of strategies during the month.

Top 10 PMS Strategies of September 2023

The following are the top 10 funds from the 346 PMS strategies tracked and analyzed by PMS Bazaar.

The top performers put up a pretty strong show during the month. They delivered nearly 3-5 times the returns of the Nifty and BSE 500. Many strategies did well in the month, though multi-caps did figure a bit more prominently in the top 10 list.

On top of the performance chart was Invasset’s Growth Pro Max fund, a multi-cap strategy, with 9.54% returns during the month.

Taking second place was the Long Alpha fund of Estee Advisors, with 8.22% returns in September. The strategy aims to outperform the benchmark while maintaining low volatility. It is a quantitatively driven strategy that is rule-based.

The third slot was taken by Green Lantern Capital’s Growth Fund, which delivered 7.81% returns during the month. It invests in mid and small-cap stocks.

All the other strategies gave much lower returns in comparison. Multi-cap strategies delivered 1.63% on average followed by the small & midcap segments, with a 1.5% return during the month. Large-cap strategies came next with 1.45% on average in September. Midcaps gave 1.03% on average, while thematic funds managed 0.86%. Small caps had a disappointing month as they delivered -0.18% during September, the lowest among the categories compared. 

The performance of the strategies is depicted below in the chart.

Small caps

The September month was relatively disappointing for small caps compared to their strong performances earlier. During the month the category gave just -0.18% on average. 

Of the 18 small-cap PMS strategies, only two did better than the benchmark BSE 500 TRI. When the Nifty 50 TRI is taken, only 3 strategies outperformed the index.

India Opportunities Product from Aequitas Investment Consultancy topped the list in the category by delivering 3.39% returns during September. The fund follows a blend of growth, value and contrarian strategies.

The Small Cap Portfolio from SageOne, which invests in a portfolio of 12-20 small cap businesses, came second with 2.9% returns during the month.

Third in the list with 2.01% returns in the month was the Special Situations Portfolio from O3 Securities, which invests in companies where there is visible business turnaround and high growth potential.

The performance of the category in September with respect to the BSE 500 TRI and Nifty 50 TRI is depicted in the graph below.

Small & Midcaps

The small and midcaps segment gave 1.5% returns on average during the month. 

Green Lantern Capital’s Growth Fund was the best-performing strategy in the category with 7.8% returns in September. 

Emerging Star Fund from Composite Investments was second with 3.67% returns during the month. The fund invests in a portfolio of 15-20 mid and small-cap stocks.

Alphabets from QED Capital Advisors was third on the list with 3.57% returns in September.

Midcap

Midcap strategies delivered modest returns in September. The category gave 1.03% on average during the month. During the month, of the 23 strategies tracked, only 7 managed to beat the Nifty 50 TRI and the BSE 500 TRI. 

The Smart Beta Portfolio of Abans Investment Managers came on top with 7.21% returns during the month.

Unifi Capital’s Insider Shadow strategy came second with 5.02% returns during the month. It invests in companies that have bought back their own shares or where promoters have acquired additional shares at market prices.

BCAD fund, again from Unifi Capital, was third in the chart with 3.46% returns delivered in September. The fund invests in growth-oriented companies that are leading beneficiaries in the migration of market share from unorganized to organized players.

The chart below shows how the midcap strategy fared against the Nifty 50 TRI and BSE 500 TRI in September.

Large and Midcap

The 16 large and midcap funds delivered a healthy 3.02% on average in September, making these strategies the top ones for the month.

The All Weather Portfolio of Torus Oro Portfolio Management was first in the performance chart with 6.54% returns. This fund follows a rule-based investment strategy and invests across stocks, bonds, gold and commodities based on market conditions.

Care Portfolio Managers’ Large & Midcap Strategy came a close second with 6.36% during the month.

The third in the chart was Samvitti Capital’s PMS Long Term Growth fund with 5.85% returns during September. 

Large cap

The Large Cap category had a middling month in September. The 25 funds delivered 1.45% on average during the month. Of the 25 strategies, 11 beat the Nifty 50 TRI, and just 9 outperformed the BSE 500 TRI during the month.

ICICI Prudential’s Large Cap Strategy was the best in the category, as it gave a 4.42% return in September.

Agreya Capital Advisors’ Momentum strategy came second with 3.69% during the month.

The ACE 15 fund from Asit C Mehta Investment Intermediates came a close third with 3.57% returns in the month.

In the chart below, the performance of the large-cap category average against the returns of the Nifty 50 TRI and BSE 500 TRI in September is depicted.

Multi-caps

The segment that has the highest number of funds managed 1.63% on average during September. We had just 52 of the 162 strategies (more than 3 in 10) outperforming the BSE 500 TRI’s return of 2.11% return during the month. Only 55 strategies outperformed the bluechip Nifty 50 TRI.

INVASSET’s Growth Pro Max Fund was the top fund on the list with 9.54% returns in September.

Coming second in the list was the Long Alpha fund from Estee Advisors with 8.22% returns during the month.

MAS Prime from Moneylife came third with 6.91% returns in September. The fund invests in high-quality funds with low volatility.

Thematic 

The thematic category had a dull month and the 14 funds delivered only 0.86% on average during the month. 

Green Portfolio’s Dividend Yield strategy with 2.73% returns during the month came on top.

Invesco’s Dawn strategy was next on the list with 2.59% returns in September.

Coming third was the Healthcare Portfolio from Incred PMS with 2.49% returns.

Summary:

As the festive season starts, all eyes would be on how consumption shapes up among Indian consumers. That would drive earnings for a host of companies.

With the earnings season upon us, the initial numbers indicate a tough macro-outlook for the IT sector. 

The numbers from large banks and NBFCs, however, have been reasonably strong.

Central Banks around the world, including India’s RBI continue to be hawkish on inflation and there appears to be no letdown on interest rates for the foreseeable future.

Production cuts and fresh conflict between Israel and Hamas in the Middle East may stoke crude prices to move higher, thus resulting in higher global inflation, China continues to grapple with a weak economy and is looking to stimulate growth.

The macroeconomic outlook does look weak from a global perspective. However, many domestic companies are doing well and the results season would set the tone for the market’s direction, though the global scenario could weigh on it for the short term.