Carnelian Asset Management and Advisors Pvt Ltd

Background

Carnelian Asset Management and Advisors Pvt Ltd, established on June 9, 2020, is a Mumbai-based investment management firm. Founded by industry veterans Vikas Khemani, Manoj Bahety, and Swati Khemani, the company is dedicated to assisting clients in creating and protecting wealth through equity investments. Carnelian aspires to build a globally recognized asset management platform distinguished by its values and expertise.

Key Strategic Focus

Carnelian's strategic focus revolves around delivering superior, risk-adjusted returns over the long term. The firm employs a proprietary MCO (Magic, Compounder, Opportunistic) framework to identify investment opportunities:

Magic: Targets accelerated growth through factors like management changes, industry shifts, and product innovations.

Compounder: Focuses on companies with sustainable moats, high return on equity, robust free cash flow, and strong governance.

Opportunistic: Seeks deep value opportunities, special situations, and temporary market dislocations.

Financials and Funding

As of February 28, 2025, Carnelian manages assets under management (AUM) totaling ₹5,392.21 crore across 3,281 clients and eight investment approaches. The firm's authorized share capital stands at ₹8.00 crore, with a paid-up capital of ₹7.65 crore.

Pipeline Development

Carnelian offers a range of Portfolio Management Services (PMS) and Alternative Investment Funds (AIFs), each tailored to specific investment strategies:

PMS Investment Approaches:

Capital Compounder: Multi-cap strategy with a 5-year return of 15.91% since inception in May 2019.

Shift Strategy: Small & mid-cap focus, delivering a 2-year return of 35.43% since October 2020.

Contra Strategy: Multi-cap approach with a 2-year return of 38.59% since January 2022.

Bespoke Strategy: Multi-cap strategy with a 2-year return of 28.51% since October 2021.

AIF Investment Approaches:

Structural Shift Fund: Category III long-only fund with a 1-year return of 2.49% since April 2022.

Capital Compounder Fund - 1: Category III long-only fund with a 5-year return of 19.56% since May 2019.

India Amritkaal Fund: Launched in August 2024.

Bharat Amritkaal Fund: Launched in April 2024.

Technological Platform and Innovation

Carnelian distinguishes itself through its proprietary forensic research framework, known as "Analysis Beyond Consensus" (ABC). This methodology involves:

Cash Flow Analysis & Capital Allocation: Prioritizing true cash flow over reported profits.

Liability Analysis: Assessing actual debt versus reported figures.

Earnings Analysis: Evaluating economic profit against reported profit.

Asset Quality Analysis: Scrutinizing asset quality, including inventories and receivables.

Related Party Transactions & Governance: Monitoring governance practices and related party dealings.

Leadership Team

Vikas Khemani: Founder with over 23 years in capital markets, formerly CEO of Edelweiss Securities Ltd. He has incubated and led several businesses to leadership positions, including Institutional Equities and Equity Research.

Manoj Bahety: Co-founder, Chartered Accountant, and CFA Charter holder with approximately 26 years of experience. He served as Deputy Head of Institutional Equity Research at Edelweiss Securities and is known for pioneering forensic research methodologies.

Swati Khemani: Co-founder with over 10 years in financial services, including roles in Investment Banking and Institutional Equities at Edelweiss Financial Services. She has experience in equity research, institutional sales, and angel investing.

Leadership Changes

As of November 30, 2022, Sachin Jain, a co-founder and director, ceased his association with Carnelian Asset Management and Advisors Pvt Ltd.

Competitor Profile

Market Insights and Dynamics

The Indian asset management industry has witnessed significant growth, driven by increasing investor participation and a growing economy. The market is characterized by a mix of established players and emerging firms offering diverse investment strategies.

Competitor Analysis

360 ONE WAM: Formerly known as IIFL Wealth Management, 360 ONE WAM is a prominent wealth and asset management company in India. As of March 2025, it managed assets exceeding ₹5.81 lakh crore (US$68 billion) and served over 7,500 clients. The firm offers a range of services, including wealth management, asset management, portfolio management, corporate treasury solutions, and lending.

Strategic Collaborations and Partnerships

Carnelian has not publicly disclosed specific strategic collaborations or partnerships. The firm's growth appears to be driven by its internal expertise and client-centric approach.

Operational Insights

Carnelian's emphasis on forensic research and its proprietary ABC framework provide a competitive edge in identifying high-quality investment opportunities and mitigating risks. This approach differentiates the firm in a crowded market by focusing on in-depth analysis and long-term value creation.

Strategic Opportunities and Future Directions

Carnelian aims to expand its asset management platform on a global scale, leveraging its strong values and expertise. The launch of new funds, such as the India Amritkaal Fund and Bharat Amritkaal Fund in 2024, indicates a strategic direction towards capturing emerging opportunities in the Indian market.