"Value is not determined by those who set the price. It is determined by those who choose to pay it." - Simon Sinek
In the land of the price-conscious customer, the unending search for value often settles when one recognises what the above quote entails - it is seldom the price setter that unlocks value, but the price payer.
Whether it is better tech or better branding, the customer must see the value in the improved product/service to be able to pay the higher price, allowing that value shift to finally occur - and the same phenomenon takes place in the stock market as well!
Hence, we’ve curated the Paterson Delta Fund - a tracker of the Indian market’s pulse that senses a value shift before it happens and capitalises on it so your money moves in multiples, not percentages.
What’s in a Name?
A word of Greek origin, Delta translates to “change”, and that is exactly what the Paterson Delta Fund is good at identifying.
It invests in companies that are engaging in a value shift of some form. Some examples of a value shift could be the transition from petrol engines to EVs, coal power to solar power, or even from drinking cheap to expensive alcohol!
With an “out with the old, in with the new” motto in place, we were able to concentrate our search for stocks that fit this bill to around 25 from the whopping 7,000+ stocks that the Indian markets have to offer - the logic of which is simple:
✅ Identify value-shifting trends across industries and categorise as nascent, growing or mature
✅ Choose companies from the growing phase + those that pass a rigorous check of their books
✅ Look out for triggers in the growing phase (accelerated growth, consumer behaviour shifts)
✅ Invest when valuations look most attractive
✅ Rebalance either when valuations and/or when a trend has played out
While this does look straightforward, the research that goes behind finding these companies, digging deep into their storylines and numbers, and finally making the decision to invest, is time-consuming and arduous.
Yet, if we had to boil it down to a few key metrics without which they don’t pass the Paterson Delta Fund checklist, they would be:
Coupled with checking for red flags like too much debt and shady corporate governance, the companies can finally make it into the exclusive and elite Paterson Delta Fund!
Brass Tacks
While all of that sounds great in theory, it is only fair that we provide a more lustrous example of what the Paterson Delta Fund truly stands for and what our checks and balances amount to. Therefore, we present it to you in action!
While Titan is a big name now, back in 2000, its business moves were considered unorthodox - setting up a branded chain of jewellery stores when the entire market (94% of it) depended on neighbourhood stores that they have been going to for generations.
Yet, Titan identified a problem - the jewellery market was too unorganised, which resulted in 60% of gold sold being of impure and subpar quality.
Hence, it began a value shift - from unorganised to organised stores, which verified authenticity and created a nationwide brand that we know as Tanishq.
The result? The stock is up almost 1000x since its journey began in 2000 - making early investors an unfathomable amount of money and a core reason for the Late Rakesh Jhunjhunwala’s wealth!
Therefore, the concept has been established once again - if it wasn’t for the customers realising that they needed what Tanishq had to offer, and paying the premium for the added value, the shift would never have occurred.
Fund Leader
The brain behind this operation is none other than Mr Prasanna Bidkar.
Has spent more than 20 years in investing.
Was the Head of Research at the iconic Dalal Street Investment Journal.
Has also head of research at Astute Feed, Dalal Times and Pentad Securities.
Has conducted more than 200 investor programmes across the country.
Managed the Value Migration smallcase at Rupeeting, which has a 2 year CAGR of 41%
If riding the wave of change to a better future is where you would like to place your money, then reach out to Paterson PMS and let us create wealth in multiples together!
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