Emkay Investment launches ₹500 crore small-cap AIF
Premium- The fund is open for both domestic and non-resident Indian investors and offers the option for quarterly redemption after an initial lock-in period of one year
NEW DELHI: Emkay Investment Managers Ltd (EIML) has launched the fourth series of its maiden Category III Alternative Investment Fund (AIF) - Emkay Emerging Stars Fund. The portfolio management services (PMS) firm aims to raise Rs500 crore from the latest fund.
The fund will be managed by Sachin Shah, fund manager, Emkay Investment Managers, which is the asset management arm of Emkay Global Financial Services Ltd.
According to the company, the investment objective of the fund is to generate long-term capital appreciation for investors from a portfolio of equity and equity related securities.
The PMS believes that current valuations for most of blue-chip stocks are stretched, with markets at an all-time high but there are enough pockets of good investment opportunities in mid- and small-cap spaces.
Emkay Emerging Stars Fund Series-IV will invest in 20-25 emerging companies, mainly in the small-cap space with a decent outlook or track-record of cash flows, a strong balance sheet, business scalability, inherent profitability, and purchase price discipline.
“We see tremendous opportunities for growth in the mid and small-cap companies. Our experienced investment team, backed by a robust research division and a time-tested investment strategy will help us to create meaningful alpha for our clients," said Shah.
The Series I, II and III of the AIF have delivered returns of 115%, 116% and 112%, respectively, over the past year.
Category III AIFs employ diverse or complex trading strategies and may employ leverage including through investment in listed or unlisted derivatives. Typically hedge funds fall in this category.
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The fourth series of the fund, like its predecessors, will be fortified by E-Qual, the governance framework developed by EIML that evaluates each company on parameters such as management quality, management integrity and liquidity, among others. Under the framework, a score is assigned to each company based on the evaluation.
The fund is open for both domestic and non-resident Indian (NRI) investors and offers the option for quarterly redemption after an initial lock-in period of one year.
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