Results analysis from Kepler Trust Intelligence

RNS Number : 5379R

Ashoka India Equity Investment Tst

08 March 2021

 

Ashoka India Equiy (AIE)

08/03/2021

Results analysis from Kepler Trust Intelligence

· Today Ashoka India Equiy (AIE) released its interim results for the period ending 31 December 2021. Over the six-months, the trust delivered NAV total returns of 28.6%, while the share price rose 39.1%. This compares favorably relative to the benchmark MSCI India IMI index, which returned 27.1%.

· Performance was largely driven by stock specific selection, demonstrating the manager's alpha generating capacity and the benefits of a large, 'on the ground' investment team.

· The manager believes that Prime Minister Modi's reforms are starting to bear fruit and the recent budget is likely to provide further tailwinds. In fact, the investment manager's report stated "this should go down as perhaps one of the best budgets from the Government, which reaffirms growth orientation and furthers the Prime Minister's goal of promoting ease of doing business in India".

Kepler View

Since the removal of lockdowns across India, the short term economic and market performance has surprised analysts on the upside, resulting in a number of upward revisions to growth estimates. Aiding this has been the promising start to the vaccination process. The Serum Institute of India - the world's largest vaccine manufacturing company - already has over 100 million doses stockpiled and has the capacity to produce a similar number every month. Alongside an improving short - term outlook, the government has pushed through landmark reforms in agriculture and labour markets, as well as a 'bold' incentive to make India the manufacturing hub of the world.

The White Oak team are looking to capitalise on these short and long-term tailwinds but remain true to their clear and well-defined processes, which revolve around identifying strong companies at the right valuations, using a proprietary cash flow valuation metric.   This team is incentivised by an unusual performance fee-only charging structure. There is no management fee payable unless the trust outperforms the benchmark over a three year period. This performance fee is worth 30% of the outperformance, paid in shares, and is mostly locked up for three years.

Whilst India has lagged the MSCI Emerging Markets Index in recent years, in our view it remains an attractive place to invest for the long term. Currently AIE is trading at a discount of 0.9%, although this has not been uncommon for the trust to trade at a premium since inception.

CLICK HERE TO READ THE FULL REPORT

Visit http://www.trustintelligence.co.uk/investor for more high quality independent investment trust research.

Important information

This report has been issued by Kepler Partners LLP.  The analyst who has prepared this report is aware that Kepler Partners LLP has a relationship with the company covered in this report and/or a conflict of interest which may impair the objectivity of the research.

Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise and you may get back less than you invested when you decide to sell your investments. It is strongly recommended that if you are a private investor independent financial advice should be taken before making any investment or financial decision.

Kepler Partners is not authorised to make recommendations to retail clients. This report has been issued by Kepler Partners LLP, is based on factual information only, is solely for information purposes only and any views contained in it must not be construed as investment or tax advice or a recommendation to buy, sell or take any action in relation to any investment.

The information provided on this website is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Kepler Partners LLP to any registration requirement within such jurisdiction or country. In particular, this website is exclusively for non-US Persons. Persons who access this information are required to inform themselves and to comply with any such restrictions.

The information contained in this website is not intended to constitute, and should not be construed as, investment advice. No representation or warranty, express or implied, is given by any person as to the accuracy or completeness of the information and no responsibility or liability is accepted for the accuracy or sufficiency of any of the information, for any errors, omissions or misstatements, negligent or otherwise. Any views and opinions, whilst given in good faith, are subject to change without notice.

This is not an official confirmation of terms and is not a recommendation, offer or solicitation to buy or sell or take any action in relation to any investment mentioned herein. Any prices or quotations contained herein are indicative only.  

Kepler Partners LLP (including its partners, employees and representatives) or a connected person may have positions in or options on the securities detailed in this report, and may buy, sell or offer to purchase or sell such securities from time to time, but will at all times be subject to restrictions imposed by the firm's internal rules. A copy of the firm's Conflict of Interest policy is available on request.

PLEASE SEE ALSO OUR TERMS AND CONDITIONS

Kepler Partners LLP is authorised and regulated by the Financial Conduct Authority (FRN 480590), registered in England and Wales at 9/10 Savile Row, London W1S 3PF with registered number OC334771.

 

END

 

 

NRABUGDXCDGDGBI