Abakkus PMS Adds Paytm, Exits Emami; Reshuffles Metals Bet After Vedanta Demerger

Abakkus Investment Managers made some notable changes to its portfolios in July, adding Paytm to its Emerging Opportunities strategy while moving out of FMCG company Emami. The fund house also reshaped its metals exposure following the Vedanta demerger and picked up a new auto-components stock in its All-Cap portfolio. 

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The changes were disclosed in the latest Portfolio Management Services (PMS) factsheets cited by Moneycontrol. 

Paytm Enters the Emerging Opportunities Portfolio 

One 97 Communications, the parent company of Paytm, was a fresh addition to Abakkus’ ₹5,997-crore Emerging Opportunities portfolio. The investment came on the back of operational growth and market-share gains cited by the fund house. 

Emami, meanwhile, made its way out of the portfolio completely. An uneven southwest monsoon and changing consumer preferences were among the factors cited for the exit, with both weighing on the near-term demand outlook. 

The portfolio itself remains tilted towards smaller companies. Small-caps account for 55.70% of the strategy, followed by mid-caps at 23.41% and large-caps at 15.32%. Another 5.57% is held in cash. 

Financial stocks occupy a sizeable part of the portfolio. NBFCs carry a 14.65% weight, while banks account for another 14.31%. 

Federal Bank is currently its largest individual holding at 6.02%. IIFL Finance follows at 5.24%, with Sarda Energy & Minerals at 4.97%, PNB Housing Finance at 4.78% and Axis Bank at 4.62%. 

The other names among its top 10 holdings are The Anup Engineering, Max Financial Services, Stylam Industries, Time Technoplast and Canara Bank. 

During the month, IIFL Finance, Federal Bank, Time Technoplast, HDFC Bank and Stylam Industries made the strongest positive contributions to the portfolio. Emmvee Photovoltaic Power, Axis Bank, Motilal Oswal Financial Services, Arvind Fashions and Max Financial Services were the main detractors. 

Since its launch on August 26, 2020, the Emerging Opportunities strategy has generated a Time-Weighted Rate of Return (TWRR) of 26.18%. The BSE 500 TRI returned 17.53% over the same period. 

Abakkus Switches Its Vedanta Exposure 

The reshuffle extended to the fund house’s ₹7,769-crore All-Cap strategy. 

Following Vedanta’s corporate demerger, Abakkus exited the parent company and moved its exposure to Vedanta Aluminium Metal. The demerged company now accounts for 5.65% of the portfolio, making it the strategy’s second-largest holding. 

Abakkus also used cash to take a fresh position in ZF Commercial Vehicle Control Systems India. The investment case cited in the report centres on mandatory vehicle-safety norms and the potential acceleration in business from FY28 onwards. 

Unlike Emerging Opportunities, the All-Cap strategy is dominated by large-cap companies, which account for 63.18% of the portfolio. Mid-caps make up 17.43%, small-caps 12.88%, while cash stands at 6.51%. 

Industrials are its largest sector exposure at 15.95%, narrowly ahead of banks at 15.48%. NBFCs account for 11.14%, commodities 10.79% and healthcare 8.89%. 

Aditya Birla Capital is the biggest holding at 5.69%, just ahead of Vedanta Aluminium Metal. Sun Pharma accounts for 5.60% and IIFL Finance 5.45%, followed by L&T, Polycab India, Axis Bank, Max Financial Services, HDFC Bank and NTPC. 

IIFL Finance, HDFC Bank, Sun Pharma, Suzlon Energy, Grasim Industries and Axis Bank contributed positively during the month. Max Financial Services, ICICI Bank, Indus Towers and JSW Dulux were among the key detractors. 

The All-Cap strategy has delivered a TWRR of 22.62% since its inception on October 29, 2020, compared with 17.81% for the BSE 500 TRI over the same period. 

Both the Emerging Opportunities and All-Cap PMS strategies are managed by Aman Chowhan.