Eklavya’s value proposition is to help clients sleep better at night when it comes to their long term investments
Abhisek Chauhan, Managing Partner
Of late, we are seeing a rapid increase in the number of HNIs & ultra-HNIs across India. While their need to diversify their investments has been the primary driver of the portfolio management services (PMS) market, the rising disposable income among middle-class population has resulted in a large portion of general public aspiring to join the investment bandwagon through equities, mutual funds and many other options. However, given the market fluctuations, it is paramount to get assistance from expert PMS companies who understand the pulse of the market and are able to help people make investments that ensure they are able to meet their future financial needs. One such expert PMS provider who is handholding their customers to make smart investments and achieve their financial aspirations is Gurgaon-based Eklavya Capital.
Long-term Growth Oriented Service Portfolio
As a boutique portfolio management service provider, Eklavya firmly believes equities to be the best long-term asset class available for investors, provided they are able to avoid the risks associated with it. The company offers two key services – a long-term multi asset offering which has low beta, i.e., not tightly linked to market cycles and aim to provide higher than inflation post-tax returns. The second offering is Eklavya Equity, through which the company takes 100 percent equity exposure if the valuations are reasonable. It caters to client who want to grow their surplus to meet their long term financial 5, 10 or 15 years down the line. It invests in stable businesses that have long-term growth prospects at reasonable price in order to mitigate two critical long term risks, i.e. inflation and unforeseen market events.
“We believe our client’s money should be handled exactly as hard-earned money should be handled, with a lot of care. We understand one-time mishaps can undo years of outperformance, and we are vigilant against exposing our clients to such risks. At the same time, we are focused on generating above-par returns by taking part ownership in excellent business. We call it investing with a ‘business-owner’ mindset, where we like to be part-owners in companies with stable fundamentals and good long-term growth potential when they are available at reasonable prices. Once we buy shares of those companies, we intend to keep owning them for a very long time. We believe owning such companies is like owning a piece of land or a gold cube that keeps increasing in size every year”, says Abhishek Chauhan, Managing Partner, Eklavya Capital.
Client-centricity at the Core
Eklavya has formulated each of its services around two fundamental principles – risk mitigation and long-term growth. It handholds customers throughout the entire process, wherein it first understands their financial goals & risk appetite and plan their investments accordingly, For example, if a client require their funds for any purpose over the next five years, Eklavya team advises them against investing that money in equities, as the equity markets are uncertain over that time horizon. Eklavya also understands the dilemma that investor go through in terms of fear of investing further or missing-out on a potentially big rally. Thus, the company invests 50 percent of a client's money in a systematic time-bound manner, while the remaining half is invested only if any good business is available at reasonable price. This way, Eklavya helps its customers to gain from both a market rally as well as a market correction and creating a win-win situation in both market conditions.
Eklavya’s value proposition is to help clients sleep better at night when it comes to their long term investmentsAbhisek Chauhan, Managing Partner
Further elucidating about Eklavya’s client-centricity, Abhishek elucidates, “A few years back, while our equity portfolio was performing very well, a portion of the portfolio was invested in liquid funds which in that particular year gave only a return of four percent. We decided to completely waive-off the management fee on that portion invested in the liquid funds, as the clients would be left with low returns if they were to pay our fee. Additionally, we also provide our customers with regular updates on how businesses in their investment portfolio are currently performing and their future prospects. Further, customers can not only contact the Eklavya team via phone to resolve any queries/concerns, but can also call me directly on my number in case of any concerns. This 'Customer First' approach of ours has been the key differentiator for us in the market”.
Standing a Class Apart
Instead of trying to promise high returns and then depending on unpredictable market cycles to fulfill the promise, Eklavya maintains a clear and transparent line of communications with its customers and makes sure that they have realistic expectations, right from the time they approach the company. Eklavya strictly avoids big risks such as businesses with high debt & dodgy promoters, and doesn’t partner with customers expecting high returns within a short time. This has helped the firm immensely to not only satisfy its customers’ expectation, but also maintain a crystal clear track record of around 1 percent client attrition rate.
“We do not want to get a lot of customers, but we want to build long and enduring relationships with a select client base. To do so, we set very clear expectation and ensure to deliver them. In case we aren’t able to meet them for any reason, we own it up through the investor letters that we send so that the client know first from us if anything goes wrong. Our value proposition is that we help you sleep better at night when it comes to your long term investment", Abhishek explains.
The Way Forward
When asked about Eklavya’s future roadmap, Abhishek says, “While we cater to clients across major Indian & foreign cities and are currently growing at a CAGR of 30 percent over the last few years, going forward, we plan to grow at a faster pace once the valuations become more reasonable. Additionally, we aspire positioning ourselves as the most trustworthy long-term partner for our clients who believe in our core philosophy”.
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