Client Case Study
Rajender Murthy 40, Bangalore, is an assiduous IT guy in a managerial position. His career domain and designation make his work schedule hectic and his disposable income decent. Unlike tech native Gen-Z clan of today, which is hooked to travel the whole world with their money, Murthy has better plans. He strongly believes in savings and investments for the better future security of his family. Analysing the user persona of Rajender discussed above, he has been the ultimate favourite customer of bankers, brokers, financial advisors, money managers, and everybody in the market who is trying to reach his mutual fund sale target for years now.
One day while reading Money control, he came across an eye-opening article stating the benefits of hiring a professional equity investment advisor written by our founder at Sukhanidhi Investment Advisors. Murthy found the insights real and was instigated to share his financial concerns with us. To initiate with he shared his NSDL statement. It was not very long as the constitution of the country but long enough to be analysed for two days. He had made an investment worth 45 lakhs in actively managed equity mutual funds and was paying a fee of around 2.20%, a heavy sum of Rs. 99,000 per annum on average. Tracking 50 schemes is no joke. Not only the portfolio was tedious to analyse but it was difficult to manage as well. The commission charged was exorbitant enough to simply eat away a good portion of the gain. Tough game. We suggested Murthy to sell everything and make a smart exit. While the money was reaching the bank in 3 days, we started with Investment Advisory Agreement, KYC documentation, and the risk profiling process.
After Murthy filled out the risk profiling form offered by the Sukhanidhi team to understand financial goals and the risk appetite of the investor, the result needed an evaluation. Investors are usually classified into three main categories based on how much risk they can tolerate. They include aggressive, moderate, and conservative. Knowing the risk level well helps plan a quality portfolio tailored in alliance with the need and drives the way an investor should invest.
Murthy had a moderate risk profile and hence we created a concentrated direct equity portfolio of 20 high-quality stocks with proven and time-tested investment styles and strategies based on his goal of accumulating a corpus of 10 crores in the next 15 years. Here are some qualitative & quantitative parameters that the Sukhanidhi team keenly focuses on to build a fool-proof quality portfolio.
- Big franchises with sustainable long term business models
- Displaying a credible and long track record of profitability
- Brand Loyalty
- Robust predictable cash flows
- Justifiable high return on capital
- Powerful growth potential and economic moat
- Honest and capable management
- Healthy profit margins and solid balance sheets
Some part of the strategy is vision. The other is amazing numbers. The proficient team considers the following quantitative parameters to build a quality portfolio, infamous for its great returns in long run:
- Market capitalization of over ₹ 1,000 crores.
- The company should have been in existence for at least 10 years.
- The company should have delivered Revenue of at least 10 per cent and a Return on Capital Employed (ROCE) of at least 14 per cent consistently over the last 10 years.
Look at the below table to understand the comparative performance analysis of how Sukhanidhi’s elite equity portfolios outperform the other financial instruments available in the market.
Murthy was not only impressed by the research process, knowledge expertise, transparency, and investment ethics displayed by the Sukhanidhi team but he was elated. It was the first time in his life he had sat down to understand his investment choices. He had somebody to mentor him and offer unbiased investment advice. Not that he had never done this exercise before in life. He obviously had gone through the process multiple times prior to his encounter with Sukhanidhi investment advisors, but no investment advice seemed this simple, safe, and sensible. Now, he exactly knew where his money was being invested, why it was invested in that particular stock, and what will be the long-term consequence of the same. He invested a sum of Rs. 45,00,000, i.e., his all-career savings till today, and also started with a Equity SIP plan of investing 1,00,000 per month in the same portfolio.
Fees and returns comparison chart:
Once the investment plan was ready as per requirement, Murthy made a choice to execute it by himself considering all the good recommendations. By doing this he saved an exorbitant commission of around 2.20% which was nearly Rs. 99,000 as discussed earlier. He now paid a fee of 1% (new iPhone with saved commission money every month) and also reaped superior returns as compared to what his portfolio generated earlier. The portfolio is sensible, easy to manage, and keep a track of. He is not only accumulating wealth from this golden portfolio especially customised to his needs, but also enjoys some joyful time with his family and friends apart from a sound sleep which is a rare affair for the majority of know-nothing investors. Rajender Murthy made a smart call of contacting the right people with the right knowledge at right time for the right advice. He is one of our happy customers for years now and keeps on recommending us to his old and new friends. Hasn’t he sent for you, yet?
Wait no more, and consult us for genuine and unbiased investment advice tailored to your requirement. Feel free to give us a call at 📞1800 889 0255
Happy investing!
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Disclaimer: The example is truly based on real-time life incidents. The name used in the example is deliberately kept fictional keeping in mind the consumer privacy and regulatory laws to protect data.
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