Continuing with the rally for the fourth straight month, the market indices rose to record levels in July. Though there was some weakness in the markets towards the end of the month due to rate hikes by the European Central Bank and the Federal Reserve, equities still finished the month well. The Nifty 50 TRI recorded 3.03% return during July, while the BSE 500 TRI delivered a solid 3.95% in the month. The markets were buoyed by the buying from FIIs as they bought (net purchase) of Rs 13,922 crore in the cash market in July, even as DIIs net sold a bit.

The July month saw 262 of the 340 (or nearly 8 in 10) PMSes perform better than the Nifty 50 TRI. As many as 208 schemes (more than six in 10) outperformed the BSE 500 TRI in July.

On average, PMS Investment Approaches recorded 5.01% returns during the month, much higher than the Nifty and BSE 500’s performance. The performance chart was dominated by multicap and small cap categories.

Top 10 PMS Investment Approaches of July 2023

The following are the top 10 PMS Investment Approaches from the 340 PMSes tracked and analyzed by PMS Bazaar.

It was an excellent showing from the top 10 PMS Investment Approaches, as all of them recorded more than 12% returns during the month. Multi Cap and small & midcap styles dominated the list in July.

The top 10 PMS Investment Approaches delivered 4x to 5x the returns of the Nifty 50 TRI and BSE 500 TRI.

Topping the chart was the Aggressive Investment Approach of Badjate Stocks & Shares with a whopping 16.24% returns during the month. This Investment Approach invests in high beta stocks from the small and midcap segments. 

The India Opportunities Product of Aequitas Investment Consultancy came a close second with 16.04% returns in July. This Investment Approach adopts a mix of contrarian investing and in-house research to invest in companies with sound fundamentals in the small cap space.

Third in the chart was Credent Asset Management’s Growth Portfolio with 15.26% returns. This Investment Approach uses short and long-term parameters such as financial trend, price momentum, quality, and valuation for portfolio selection.

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The performance of the top 10 PMSes and their comparison with Nifty 50 TRI and BSE 500 TRI for the month are given below.

Category-wise performance of PMS players

The chart below depicts the performance of the PMS schemes across categories in July. The small & midcap category came on top with an average return of 6.73%, followed closely by small caps, with 6.46% during the month. Midcap and multi cap Category came in next, as each of the categories delivered more than 5% on an average in July. Large caps were relative laggards, given that they gave only 3.38% return in the month. The Thematic category, too, had a rather modest month, giving only 3.93% on average.

Small caps

These PMS Investment Approaches have been at the forefront of the broader market revival and have received considerable investor interest. Small cap PMSes delivered a healthy 6.46% return during July, picking up from where they left in the previous month. 

Of the 20 PMS Investment Approaches, 16 delivered more than the BSE 500 TRI. Also, 18 PMSes beat the Nifty 50 TRI.

India Opportunities Product of Aequitas Investment Consultancy was the top fund with 16.04% returns during the month. 

Equirus Wealth’s Long Horizon Fund came in second with 13.35% return during the month. It follows a blend of value and quality investing strategies. 

Vrddhi from IThought Financial Consulting came third with 10.86% return in July.

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

Small & Midcaps

The small and midcaps segment was the top category during the month, delivering a robust 6.73% return in July. 

First on the list was the Aggressive Investment Approach of Badjate Stocks & Shares, with 16.24% returns.

The second slot was taken by Silverarch’s Mid and Small Cap Equity Investment Approach with 12.84% returns. This PMS Investment Approach focuses on companies that are likely to grow strongly over a 3-5-year horizon.

Abakkus Asset Manager’s Emerging Opportunities Approach came in a close third with 12.64% returns during the month.

Midcap

The Midcap category delivered above-average returns during July, and the category gave 5.27%. During the month, 18 of the 23 PMS Investment Approaches beat the Nifty 50 TRI, while only 15 outperformed the BSE 500 TRI.

Leading the charts was ACE Midcap from Ait C Mehta Investment Intermediaries, with 12.51% returns in July. This Investment Approach invests in 20-25 equal-weighted stocks.

Next in the category was the Deep Value Investment Approach of Centrum PMS with 8.68% returns.

The Smart Beta Portfolio from Abans Investment Managers came third and delivered 8.05% in July. It follows a proprietary, algorithm-driven, and rule-based stock-selection process.

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

Large and Midcap

The 15 large and midcap PMSes delivered 4.49% on an average in July. 

Samvitti Capital’s PMS Aggressive Growth Investment Approach came on top with 10.17% returns during the month. It invests in high-quality businesses.

Motilal Oswal’s Multifactor Equity Investment Approach was second with 7.41% returns recorded during the month.

The Large and Midcap Strategy of Care Portfolio Managers was third in the category with 6.20% returns in July. This PMS invests in 18-20 stocks from the top 250 companies by market capitalization.

Large cap

The Large cap category with 26 PMSes delivered 3.38% on average in the month of July. But the performance of this category, on the whole, was not superior. Only 14 of these PMSes beat the Nifty 50 TRI, and just 9 did better than the BSE 500 TRI.

Tulsian PMS topped the charts with 6.95% returns during the month. This was closely followed by Magnolia of Karma Capital Advisors with 6.87% return. This Invesment Approach follows a ‘growth at reasonable price’ approach and invests mostly in large caps, though mid and small caps also figure in its portfolio.

The India Business Leader Investment Approach of Right Horizons came in third with 5.9% returns during 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 July is depicted.

Multi-caps

The Multi-cap PMSes delivered 5.06% return on average during July. We had 100 of the 156 PMSes (nearly two in three) outperforming the BSE 500 TRI’s return of 3.95% in July. As many as 128 (more than 8 in 10) outperformed the bluechip Nifty 50 TRI.

The Growth Portfolio of Credent Asset Management came on top with 15.26% returns during the month. 

INVASSET’s Growth Pro Max Fund was the second on the list with 15.06% returns in July.

Next on the list was the Alpha Growth Investment Approach of Ambit Global with 13.9% returns in the month.

Thematic 

The thematic category was a bit lackadaisical compared to most other categories during the month.

Green Portfolio’s Dividend Yield was the topper with 6.22% returns during the month. 

Second on the list was the Rise Investment Approach of Invesco, with 6.2% returns in July.

Though the market did end the month of July on a positive note, there has been some weakness in recent weeks. The increase in interest rates by the Federal Reserve and ECB towards the end of July has resulted in bond yields inching up, resulting in corrections across global equity markets, as also in India. There was also a credit downgrade of the US by Fitch, which added to the weak sentiments. 

Corporate results for the June quarter have largely been robust across sectors – banking, capital goods, FMCG, construction, etc. – except for odd ones such as software services. 

However, inflationary concerns have come to the fore once again as food prices have soared over the past couple of months. The RBI has maintained its pause on interest rates. But a sticky inflation scenario will mean that interest rates could stay elevated for the foreseeable future.