Introduction
This smallcase has been formulated to get access to companies that have a global presence. This enables us to get our hands on global businesses that drive growth. The smallcase has only companies with a presence in more than one country. Investors would be able to invest in companies with cheaper funds and better technology to drive future growth. Simultaneously these companies would have access to global resources for better and more efficient functioning.
Investment Drivers
We here focus on stocks with a global presence and access to superior technology and resources. All of these cumulatively help the business flourish better than a company working in only one country. We here at green portfolio try to avoid investing in PSE’s because their primary function is not wealth creation. A public sector enterprise was incorporated to serve first and make profits later. Other than that, PSEs carry an inherent red-tapism in their operational culture, which in our view, makes for inefficient use of resources.
Investment Philosophy
Only those companies are chosen that have a strong balance sheet and this is made sure by picking only those stocks that have low debt on books. D/E ratio is an essential screening criteria here. In our view, over-leveraging is the best way to sink a business and weaken its ability to adapt and capitalize on new opportunities. Hence, we avoid companies with a Debt to Equity ratio higher than 100%.
Buying a Company at the right price helps us maintain a margin of safety on your investments. This helps us generate higher capital appreciation. We use the income, market, and asset approach to evaluate the company’s valuations.
Those companies are chosen, that have great product and service offerings. These companies usually trade at a premium to their domestic peers. Therefore the strategy is to invest in growing MNC companies which are available at reasonable valuations.
Who should invest in this smallcase?
This smallcase is especially beneficial for investors looking for a multi-cap investment strategy and want to benefit from companies that work across multiple countries. Investors who don’t mind volatility and are looking at an investment horizon of 3 – 5 years can invest in this smallcase.