The top performers’ list in the month was dominated by multi cap category with one mid cap and flexi cap PMS investment approach making the list.
The run-up to the election results and the surprise exit poll results had led to volatility in the Indian equity markets with the benchmark indices Nifty 50 TRI and BSE 500 TRI closing flat at 0.03% and 0.83% respectively for May. In this regard, PMS investment returns also remained volatile with average returns of 391 investment approaches were slightly above the Nifty 50 TRI benchmark at 0.53%.
That said, multi cap, large cap and large & mid cap PMSes have delivered strong performances with average returns of 1.06%, 1.25% and 1.64% respectively. As such, out of 391 PMS approaches, 60% of them have beaten the Nifty 50 TRI and about 58% of them have beaten the BSE 500 TRI benchmark.
The top performers’ list in the month was dominated by multi cap category with one mid cap and flexi cap PMS investment approach making the list.
Top 10 PMS Strategies of May 2024
The following are the top 10 funds from the 386 PMS strategies tracked and analysed by PMS Bazaar.
The top 10 schemes have delivered strong performances in May compared to benchmark indices – Nifty 50 TRI (0.03%) and BSE 500 TRI (0.83%).
Unifi Capital’s Holding Co strategy was the best performing PMS in the list with the PMS delivering about 18% returns in May. The key objective of this PMS is to unlock value by investing in listed holding companies across industries. Holding companies are those companies that hold stakes in other companies.
Second, performing PMS is the ASK Lighthouse Portfolio from ASK Investment Managers. This is also a multicap PMS with a return of about 9% in May. The fund invests across market cap but invests in a few concentrated themes where structural transformation is underway.
Moat Financial Services’ Upper Crust Wealth Fund came in third with about 8% returns. The fund manager of this PMS invests only in high-conviction stocks with a focus on business fundamentals.
The performance of the top 10 strategies and their comparison with Nifty and BSE 500 for the month are given below.
Category-wise performance of PMS players
The FII being net sellers in May and the overall uncertainty in the market has taken a toll across indices. The small cap, mid cap and small & mid cap categories underperformed, down 1.98%, 0.48%, and 0.42% respectively. But the large cap, large & mid cap, multi cap and thematic categories performed well, outperforming benchmark indices.
The performance of the categories is depicted below in the chart.
Small cap category
May 2024 witnessed small cap category underperform the overall market, falling 1.98%, the steepest fall in this financial year. Out of 24 PMS schemes in this category, only 3 outperformed BSE 500 TRI and 5 outperformed Nifty 50 TRI.
Taking the top slot in this category was Dynamic Small cap from Dynamic Equities with 5.23%, a PMS that invests in low-valuation small-cap companies with high sales and profit growth.
Second place was by NAFA Asset Managers’ Small cap portfolio delivering 1.46% returns. While this PMS invests in small cap companies with a specific focus on quality management and growth at a reasonable price, it focuses on ROCE greater than the cost of capital.
The third slot was taken by Alphaa Focused Small cap portfolio from PRP Edge Wealth at 0.88% returns. The companies selected are from the AMFI’s small cap lists which are then filtered based on their respective fundamentals.
The performance of the category in May with respect to the BSE 500 TRI and Nifty 50 TRI is depicted in the graph below.
Small & Midcap
May was a challenging month for this category with more than half of the 30 approaches underperforming, resulting in an average return of -0.42%. However, more than 40% of the PMS approaches under this category managed to deliver notable returns.
Leading the category is Alphabets by QED Capital Advisors LLP with a staggering 5.85% return. QED Capital Advisors is a quant-based strategy focusing on disciplined and long-term investment approaches.
In the second place is AAA Building Beasts by AlfAccurate Advidors with a 3.20% return. A PMS that emphasises on high-quality management, and value investing approach.
Securing third place is PIPE Strategy by ICICI Prudential AMC Ltd with a 2.96% return. This strategy focuses on private investments in public equity.
Following are the top performers in small and midcap category:
Midcap
In May, the performance of 26 mid cap PMS approaches varied, resulting in an average return of -0.48%. Some approaches demonstrated notable performances, with 9 outperforming the BSE 500 TRI benchmark (0.83%) and 11 outperforming the Nifty TRI (0.03%) benchmark.
Among the top performers, the Smart Beta Portfolio by Abans Investment Managers led with a strong performance of 6.86%. The Smart Beta Portfolio uses advanced quantitative models to select stocks.
Following closely in the second was ACE - Midcap by Asit C Mehta Investment Intermediates Ltd at 6.18%.
In third place was the Clean Tech Portfolio by NAFA Asset Managers Pvt Ltd with a respectable 4.47% return for the month. This portfolio focuses on investments in clean technology sectors, aiming for sustainable growth and competitive returns.
Following are the top performers in the midcap category:
The performance of the category in May with respect to the BSE 500 TRI and Nifty 50 TRI is depicted in the graph below.
Large & Midcap
Considering the volatility in May, this category fared well and as such the large and midcap category also performed better, achieving a return of 1.64%. Out of 16 approaches assessed, 11 delivered strong performances.
Leading the pack was the Smart Alpha 250 strategy by Alchemy Capital Management, delivering an impressive 5.63% return. The Smart Alpha 250 strategy uses a combination of both fundamental analysis and quantitative models for active portfolio management.
In second place was the Large and Midcap Strategy by Care Portfolio Managers with a 5.57% return.
Securing third place was the Bluechip Strategy by Dynamic Equities, delivering a 4.82% return.
This indicates that the large cap category offers much-needed stability during turbulent market conditions and underscores the potential within PMS approaches.
Following are the top performers in large and mid cap category:
Large cap
For the large cap category, May was an exceptional month, delivering solid average returns of 1.25% compared to other categories. Of the 23 approaches assessed, 19 of them have beaten both benchmark indices. All 19 approaches (0.03%) outperformed Nifty 50 TRI, and 15 approaches (0.83%) outperformed BSE 500 TRI.
Leading the top way was the Growth and Value strategy by JM Financial Services, achieving a remarkable 4.54% return. This strategy targets companies with strong growth potential and attractive valuations.
The Caliber strategy by Ambit Global Private Client secured second place with a strong 4.39% return.
The ACE-15 strategy by Asit C Mehta Investment Intermediates took third place with a 3.31% return. This is a concentrated portfolio with 15 high-potential stocks.
The top 3 performers under this category are:
The performance of the category in May with respect to the BSE 500 TRI and Nifty 50 TRI is depicted in the graph below.
Multicap
It was a positive month for the multi-cap category, achieving stable average returns of 1.06%. As this category invests across market capitalisation, they had a better outcome. Out of 172 approaches, 116 have beaten both benchmark indices.
Leading the way was the Holding Co strategy by Unifi Capital Pvt Ltd, delivering an astounding 17.88% return. This invests in holding companies with significant stakes in diverse businesses.
Next is the newly launched, Lighthouse Portfolio by ASK Investment Managers with a strong 8.85% return. This Portfolio aims for strong returns by investing in a diversified mix of high-quality stocks.
The UpperCrust Wealth Fund took the third place with a return of 8.05% for the month.
Below is a table highlighting the top performers of multi cap category:
The performance of the category in May with respect to the BSE 500 TRI and Nifty 50 TRI is depicted in the graph below.
Thematic
The thematic category also fared well during the month delivering a positive return with an average return of 0.35%. Of the 16 PMS approaches, 9 were able to beat the benchmark indices.
Leading the category was MNC PMS by Anand Rathi Advisors, securing first place with a strong performance of 5.70%. It invests in Indian subsidiaries of multinational corporations (MNCs), aiming to capitalise on their global strength and market leadership.
Second place was claimed by RISE from Invesco Asset Management, with a notable return of 4.63%. It focuses on companies that could benefit from the revival of
economic growth and consumer discretionary spending.
Third place went to the Impact ESG Fund by Green Portfolio, posting a return of 2.44%. This focuses on sustainable investments aligned with environmental, social, and governance (ESG) criteria for long-term growth.
Following are the top performers this month:
Takeaway
Despite the reassurance of a third term for the NDA government, the Indian stock market in May exhibited volatility. This flat performance stemmed from multiple factors including global economic headwinds, foreign investor outflows, and a deceleration in corporate profit growth compared to the previous quarters' robust performance.
However, some glimmers of optimism emerged. With the cloud of election uncertainty dissipating, the market's focus now pivots towards corporate earnings reports, inflation data, and a flurry of upcoming events in June. These include the cabinet formation following the elections which could bring significant policy announcements and potential additional policy measures. Further, India's inclusion in the JP Morgan Global Bond Index in June and the upcoming July budget are developments to keep an eye on.
Finally, the arrival of a good monsoon season, which could boost rural consumption, and a potential rise in infrastructure investments due to reduced political uncertainty are factors that could influence the market's trajectory.
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