Marcellus Investment Managers: Company Profile

Background

Founded in 2018, Marcellus Investment Managers aims to simplify wealth creation by serving as trustworthy and transparent capital allocators. The firm focuses on channeling household savings into high-quality Indian companies with strong governance and effective capital allocation. Marcellus is licensed by the Securities and Exchange Board of India (SEBI) to offer Portfolio Management Services (PMS) and Investment Advisory (IA) services.

Key Strategic Focus

Marcellus employs a three-pronged investment approach:

1. Clean Accounts: Utilizing forensic accounting and capital allocation assessments to define the investible universe.

2. Capital Allocation: Targeting companies with superior capital allocation records, emphasizing free cash flow generation and reinvestment for growth.

3. Competitive Advantage: Conducting in-depth primary research to build portfolios of companies with deep competitive moats.

This strategy involves holding companies for extended periods to capture long-term compounding benefits and deliver superior returns.

Financials and Funding

As of July 2024, Marcellus managed assets under management (AUM) totaling approximately $1.0 billion. The firm serves a diverse client base, including 5,836 individual investors and 78 high-net-worth individuals. The company's paid-up capital stands at ₹5.4 crore, with an authorized capital of ₹8.0 crore.

Pipeline Development

Marcellus offers several investment products:

Consistent Compounders: Invests in companies with clean accounts, superior capital allocation records, and high barriers to entry.

Rising Giants: Focuses on mid-sized companies with strong growth potential and competitive advantages.

Little Champs: Targets small-cap companies with excellent corporate governance and capital allocation track records.

Kings of Capital: Concentrates on the financial sector, including banks, NBFCs, insurers, asset managers, and brokers.

MeritorQ: Employs a rules-based approach to screen for companies with low leverage and consistent profitability.

Global Compounders: Invests in 20-30 deeply moated global companies based on rigorous bottom-up research.

These products are designed to cater to various investor preferences and risk appetites.

Technological Platform and Innovation

Marcellus leverages proprietary forensic accounting models to screen for accounting quality, serving as proxies for corporate governance and promoter integrity. The firm employs a combination of forensic accounting and capital allocation assessments to define its investible universe. This approach involves in-depth primary research to construct portfolios of companies with deep competitive moats, holding these companies for long periods to capture long-term compounding benefits.

Leadership Team

Marcellus boasts a seasoned leadership team with extensive experience in investment management:

Saurabh Mukherjea, FRSA: Founder and Chief Investment Officer. Educated at the London School of Economics, he co-founded Clear Capital in London before returning to India.

Pramod Gubbi, CFA: Head of Client Advisory and Relationship. Former Managing Director & Head of Institutional Equities at Ambit Capital, with prior experience in Singapore.

Rakshit Ranjan, CFA: Fund Manager. Previously covered UK equities at Lloyds Bank and Execution Noble; launched and managed Ambit's Coffee Can PMS.

Manish Hemnani: Head of Technology and Operations. Over 12 years in quantitative data analytics, founder of Crosstab Limited in London.

Ashvin Shetty, CFA: Fund Manager. Led automobile sector coverage at Ambit Capital; senior analyst for Ambit's Mid and Small cap PMS funds.

Sudhanshu Nahta, CA: Investment Analyst. Former Executive Assistant to the CEO at Ambit Capital; experience in statutory audit with KPMG.

Nitesh Bhadani, CA: Client Advisory and Relationship Manager. Over 16 years in investment banking, equity research, and private equity; worked at Ambit Private Ltd and SAIF Partners.

Tej Shah, CFA: Fund Manager. Experience with Mayfield, a Silicon Valley venture capital fund, and part of Mayfield India's investment team.

Salil Desai, CA: Investment Analyst. Former senior member at Premji Invest, managing ~$2bn in listed equities; prior experience at IDFC Securities.

Parimal Deuskar, CS: Head of Compliance and Legal. Set up the Group Compliance Function at Avendus Capital; experienced with securities market regulators globally.

Sapana Bhavsar: Head of People and Culture. 15 years in Human Resources; led India HR Shared Services at CRISIL; experience with Bank of America Merrill Lynch.

Pankaj Gupta: Head of Finance. Over 13 years in banking and NBFCs; former Finance Head at Fullerton India Home Finance Company.

Surendra Singh: Head of Operations. Over 16 years in financial services; experience with Aditya Birla AMC, ICICI Prudential AMC, Edelweiss Wealth Management, and Motilal Oswal.

Siddharth Joshi: Head of Technology. 17 years in technology management; provided technology consultation at Nomura.

Arjun Bhattacharya: Client Advisory and Relationship Manager. 16 years of experience; former Equity Strategist at Lehman Brothers, Nomura, and Macquarie Capital.

Jaibir Singh Sethi: Investment Analyst. 9 years at Premji Invest, managing ~$3bn in listed equities; prior roles at CLSA and Clear Capital.

Krishnan V R: Investment Analyst. Around 10 years in equity and fixed income research; part of the New Indexes Development team at Morningstar.

Arindam Mandal: Investment Analyst. Nearly a decade in the U.S. with Principal Global Investors; experience as a Quantitative Analyst and sector analyst for US Industrials and Utilities.

Achint Bhagat: Client Advisory and Relationship Manager. Over 10 years in capital markets; former equity research analyst at Ambit Capital; helped set up Ambit's equity sales presence in North America.

Leadership Changes

As of the latest available information, there have been no recent significant changes or appointments within Marcellus Investment Managers' leadership team.

Competitor Profile

Market Insights and Dynamics

The Indian investment management industry has experienced significant growth, driven by increasing household savings and a growing appetite for equity investments. The market is characterized by a mix of established players and emerging firms offering diverse investment products.

Competitor Analysis

Marcellus faces competition from various firms, including:

Investec India: Estimated annual revenue of $11.6 million with 110 employees.

SD Corporation: Estimated annual revenue of $8.3 million with 110 employees.

FASTTRACK HOUSING: Estimated annual revenue of $11.6 million with 110 employees.

These competitors offer a range of investment management services, contributing to a dynamic and competitive landscape.

Strategic Collaborations and Partnerships

Marcellus has not publicly disclosed specific strategic collaborations or partnerships. The firm's focus remains on delivering value through its proprietary investment strategies and in-depth research methodologies.

Operational Insights

Marcellus differentiates itself through a disciplined investment philosophy centered on forensic accounting, capital allocation assessment, and competitive advantage analysis. This approach allows the firm to construct portfolios with low churn, capturing long-term compounding benefits and delivering superior returns to investors.

Strategic Opportunities and Future Directions

Marcellus is well-positioned to capitalize on the growing demand for transparent and trustworthy investment management services in India. By adhering to its core investment principles.