Shankar Sharma, Samir Arora’s PMSes lagged in May after stellar YTD run; smallcap funds excelled

MUMBAI: Smallcap- and midcap-focused portfolio management strategies (PMS) were the biggest winners in May and churned out returns of up to 17.2 per cent as they benefited from the strong momentum shown by these pockets on Dalal Street, data compiled by PMSBazaar showed.

Midcap and smallcap stocks have been consistent outperformers during the second wave of the pandemic, due to the influx of money from retail investors and domestic institutional investors. The Nifty Midcap 100 index rose 6.5 per cent during the month, while Nifty Smallcap 100 rose nearly 9 per cent.

The best-performing PMS strategy of May was Care Portfolio Managers’ Growth Plus Value fund, which gave 17 per cent returns. The Rs 412-crore fund outperformed bigger names such as Kotak AMC’s Small and Midcap Fund and Abakkus Asset Managers’ Emerging Opportunities Fund.


The Sunil Singhania-run Abakkus Emerging Opportunities Fund was the third best performer for the month with 14.3 per cent return, while Vikas Khemani’s Carnelian Shift Strategy took the fourth place with 13.8 per cent returns.

Midcap and smallcap stocks have generated superior returns in the recent months due to investors’ perception that the impact of the second wave of Covid on the economy would be minimal, while consumer spending will return in the second half of the year to boost earnings.

Money managers indicated that declining debt and improving market share among midcap and smallcap companies during the pandemic has boosted confidence among investors of a sustained rise in these pockets of the market.

Big shots underperform
Saurabh Mukherjea’s Marcellus Investment Managers had a bittersweet May. The PMS’ Consistent Compounders Strategy returned 8.6 per cent, beating the BSE500 index, but its Little Champs rose only 6.7 per cent, significantly underperforming the benchmark.

Shankar Sharma’s FirstGlobal India Super50 strategy gave 5.4 per cent returns, underperforming its benchmarks. Samir Arora’s Helios Capital saw its multicap fund return merely 4.7 per cent in May, underperforming the BSE500 index.

While FirstGlobal's India Super50 strategy had an off month in May, over the past 12 months the fund has given a return of 79.20 per cent, comfortably beating the BSE500 in that period. Helios Capital's more circumspect style of investing has meant that over the past year the India Rising strategy has managed 57.4 per cent returns, lower than the BSE500.

Hiren Ved-led and Rakesh Jhunjhunwala-backed Alchemy Capital saw most of its funds underperform their benchmarks in May after strong performances earlier this year. The Rs 3,100 crore Alchemy Select Stock scheme gave merely 4.6 per cent returns, while Alchemy High Growth Fund was the only fund that managed to outperform its benchmark.

Alchemy's newest fund Ascent took a breather from its recent outperformance as it underperformed in May but still remains one of the best performing PMSs over the past year with returns of 98.3 per cent.