ETMarkets PMS Talk | 20 months of consolidation has created compelling small-cap opportunities: Equitree’s Pawan Bharaddia

Pawan Bharaddia of Equitree Emerging Opportunities Fund highlights that 20 months of consolidation in small-caps has created compelling opportunities, with the broader small-cap universe of companies in the Rs 1,000-5,000 crore market cap range down by close to 30%. His PMS has compounded at about 21% over five years and around 40% from the COVID bottom over six years, though the last two years have been largely flat. He advocates a private equity-style approach of taking 3-5% meaningful minority stakes in 12-15 concentrated small-cap companies, focusing on import substitution, manufacturing, infrastructure ancillaries and consumption themes.