June

June 2024
2022

Monthly
Communication
March 2025

www.abakkusinvest.com

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Market Outlook June 2024
March 2025

Market Update yield ended February at 6.7%, while the USD/INR exchange rate
was 87.40. Brent crude oil prices also rose, closing at around $73
Indian equities registered its fifth consecutive monthly loss per barrel in February.
In February 2025. Sentiment was visibly pessimistic, and Gross GST collections were ₹1.84 lakh crore in February 2025,
losses were widespread. While Nifty index continued decline reflecting a 9.1% rise compared to February 2024, and 9.4%
by 5.9% for the month, the broader markets saw sharper increase year-to-date.
declines with the midcap and small cap indices down 10.8%
and 13.1% respectively. All the sectors ended the month in Brent Crude
red; with Capital Goods, PSU and Real estate falling the most
130
by 14.4%, 13.5% and 13.4%, respectively.
120

Key domestic developments included the Union Budget 110

which saw continued government’s focus on fiscal 100

consolidation while providing a boost to consumption by 90

way of tax cuts. The RBI started off the rate-cut cycle with a 80

25-bps cut in repo rate to 6.25%, after being on a pause for 70 73

24 months. It also reduced risk weights for bank financing to 60

NBFCs and microfinance loans. BJP won the Delhi legislative

Nov-22

Nov-23

Jan-24

Nov-24
May-22
Jun-22
Jul-22
Aug-22
Sep-22

Jan-23
Feb-23

Jun-23
Jul-23
Aug-23

Jan-25
May-23

Sep-23

Feb-24

May-24
Jun-24

Feb-25
Dec-22

Mar-23
Oct-22

Oct-23

Dec-23

Mar-24

Jul-24
Aug-24
Sep-24
Oct-24

Dec-24
Apr-22

Apr-23

Apr-24
assembly elections with 48 out of 70 seats, marking its return
to power in the capital after 27 years. Source: Bloomberg

On the investment front, Foreign Portfolio Investors (FPIs) sold Earnings Review – 3QFY25
$4.7 billion of Indian equities in secondary market by February The 3QFY25 corporate earnings season was modest, with
27. Domestic Institutional Investors (DIIs) were net buyers, BFSI, Technology, Telecom, Healthcare, Capital Goods, and
acquiring $6 billion worth of stocks by the end of the month. Real Estate contributing positively. Nifty delivered a 5%
Meanwhile, global markets saw mixed results: Indonesia YoY PAT growth, marking the third successive quarter of
recorded a significant loss of (-11.8%), while Thailand (-8.4%) single-digit growth since the pandemic. This growth was
and Japan (-6.1%) also experienced declines. On the positive significantly supported by a few key players, while others
side, markets in Hong Kong (+13.4%), Germany (+3.8%), and negatively impacted the overall performance. The earnings
Mexico (+3.0%) saw gains. growth was hindered by sectors such as O&G (OMC’s profit
declined 18% YoY), Cement (-55% YoY), Chemicals (-12%
Global and regional indices 1 Month performance (%)
YoY), and Consumer (-5% YoY).
A concerning trend emerged as earnings downgrades
15 13.4
outnumbered upgrades, particularly outside the Nifty 50
10 universe. While the EBITDA margin (excluding Financials)
5 3.8 3 2.3 2.2 2.0 2.0 expanded slightly, the gross margin contracted for most
1.6 1.1 1 0.6
sectors. Overall, the 3QFY25 earnings aligned with modest
0
expectations, but the forward earnings revisions are the
-2 -2.7 -2.9
-5
-4.2 weakest in recent times, indicating forecasts of potential
-5.9 -6.1
-10 -8.4 pressure on future earnings, especially for mid and small-
-15 -11.8 cap companies.
UK
Hong Kong
Germany

France

Singapore
Malaysia

US S&P 500

Australia
Korea

Indonesia
Nifty 50
Philippines

US Dow Jones
Mexico

Taiwan

Japan
Thailand
Shanghai

Brazil

Nifty sales up 6% YoY in 3QFY25

Source: Bloomberg, Kotak Institutional Equities (Data as on 28th February 2025 in local
currency)

Macro Update
In February, the National Statistics Office (NSO) estimated
India’s FY25 real GDP growth at 6.5% revising upward from 6.4%
as estimated in Jan’25. Inflationary pressures continued easing,
with the Consumer Price Index (CPI) falling to 4.3% in January
2025 from 5.2% in December, the lowest YoY inflation since Aug’24.
The Wholesale Price Index (WPI) also fell to 2.3% in January YoY,
from 2.4% in the previous month. Industrial production registered
a 3.2% growth in December, in comparison to 5.2% growth in
November.
India’s exports grew by 7.2% during the April-January 24-25
period compared to the same months in 23-24, while imports
Source: Motilal Oswal Financial Services Limited
rose by 9%, leading to a trade deficit of $87.5 billion for the first
ten months of FY2025. The country’s 10-year government bond

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 June 2024
March 2025

Nifty EBITDA up 8% YoY in 3QFY25 Nifty PAT up 5% YoY

Source: Motilal Oswal Financial Services Limited

change and should bring in new thoughts.

Market Outlook Globally, the Trump rhetoric now looks a bit too stretched.
The nervousness in the markets continued in February, The US $ index has already dropped to below 104 from a
with the broader markets seeing further price fall. Earnings recent high of 110 and most experts have now started calling
for the quarter, though slightly better than the previous that the US $ has seen its recent highs and should be weaker
quarter, continued to be lower than long-term trends and going forward. The tariff announcements have become too
expectations. The Trump era uncertainty and daily news regular with constant back and fro and should now have
flows continued causing almost daily uncertainty and lesser effect on the markets generally.
volatility. FII selling also continued unabated adding to the Our view is that both news flow as well as domestic macro
pressure on the markets. Though domestic funds continued and corporate data should be incrementally positive.
to be large buyers of Indian equities, unwinding from However, despite the sharp fall, Indian stocks generally are
individual investors was widespread. not cheap. However, there are pockets of good opportunities
In India, we have seen changes in leadership in two key emerging and our attempt will be to focus on that segment.
regulators. The central bank, RBI, has already seen a change We continue to have a view of a slow uptick in the markets
of stance and has pumped in quite a bit of liquidity in the with intermittent swings. Portfolio damage over the last two
economy, including a rate cut after almost three years. This months has been meaningful, but our fundamental focus
should start to show its effect on the economy in coming gives us confidence of a sharper bounce back as and when
months. SEBI, the capital market regulator, has also seen a the markets stabilize.

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Abakkus All Cap Approach
PMS Strategy June 2024
March 2025

Portfolio Update
The Portfolio continues to focus on our core philosophy of fundamental based investing. The portfolio, in a challenging
month, saw a meaningful drawdown, though inline and lower than the broader markets (midcap and small cap
indices down 10.8% and 13.1% respectively). Since inception the portfolio is up 150.0% absolute. Stock price and market
movements have been more on news flows and that has caused near-term performance movements. We believe
our focus on risk-adjusted returns will enable us to tide over these near-term challenges and generate decent returns
and alpha for our investors.

Portfolio Performance as on February 28, 2025 (in INR)

Since
1 3 6 1 2 3 Since FY25
Inception FY24 CY25 CY24
Period Month Months Months Year Years Years Inception YTD
Absolute (%) YTD(%) (%)
(%) (%) (%) (%) (%) (%) CAGR (%) (%)
(%)

Abakkus All
-8.4 -15.1 -17.9 -7.2 17.3 12.4 23.5 150.0 -5.7 44.8 -13.9 13.5
Cap Approach

BSE 500 TRI -7.7 -12.2 -16.1 -0.4 17.8 12.7 19.4 116.5 -1.3 40.2 -10.9 15.8
**Unaudited Performance data for Portfolio Manager and Investment Approach provided hereunder is not verified by any regulatory authority and Past performance may
or may not sustain in the future. The performance is based on TWRR as on February 28, 2025. Inception Date is October 29, 2020. As per SEBI guidelines, returns are net of all
expenses and investor returns may differ, based on their period of investment, fee structure and point of capital flows.

Top 5 Sector Classification as on February 28, 2025 Top 10 Holdings on the basis of Asset %*

Sector Asset % SUN PHARMACEUTICAL INDUS- AXIS BANK LIMITED

TRIES LIMITED
BANKS 17.6
HDFC BANK LIMITED LARSEN AND TOUBRO LIMITED
INDUSTRIALS 11.3
HCL TECHNOLOGIES LIMITED STATE BANK OF INDIA
COMMODITIES 9.9
BHARTI AIRTEL PP LIMITED NTPC LIMITED
TELECOMMUNICATION 9.6
MAX FINANCIAL SERVICES JINDAL STAINLESS LIMITED
HEALTH CARE 9.2 LIMITED
Securities/sectors quoted are for illustration only and not recommendatory. The Data as on February 28, 2025. *The current portfolio holdings may or may not be
sectors are classified as per internal classification. a part of the future portfolio holdings and may or may not be part of all client
portfolios.

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Disclaimers
June 2024
March 2025

About Us website/email/content are true to the best of its knowledge,

Abakkus Asset Manager Private Limited (formerly known as however, assume no liability for the relevance, accuracy or
Abakkus Asset Manager LLP) (“Abakkus”) is registered as a completeness of the contents herein.
Portfolio Manager with SEBI under SEBI (Portfolio Managers)
Regulations, 2020 as amended from time to time and the Abakkus declares that the data and analysis provided shall
Circulars and Guidelines issued there under from time to time be for informational purposes. The information contained in
vide SEBI Reg. No.: INP000006457 dated March 14, 2019 and the analysis shall been obtained from various sources and
as an Investment Advisor under SEBI (Investment Advisors) reasonable care would be taken to ensure sources of data to
Regulations, 2013 as amended from time to time and the be accurate and reliable. Abakkus will not be responsible for any
Circulars and Guidelines issued there under from time to time error or omission in the data or for any losses suffered on account
vide SEBI Reg. No.: INA000015729 dated February 03, 2021. of information contained in the analysis. While the Abakkus
will take due care to ensure that all information provided is
Abakkus is also the Investment Manager to Abakkus Growth accurate however the Abakkus neither guarantees/warrants the
Fund, a SEBI registered Category III AIF vide SEBI Reg. No.: IN/ sequence, accuracy, completeness, or timeliness of the report.
AIF3/18-19/0550 dated June 05, 2018, India-Ahead Venture Neither the Abakkus nor its affiliates or their partners, directors,
Trust, a SEBI registered Category I AIF vide SEBI Reg. No.: IN/ employees, agents, or representatives, shall be responsible or
AIF1/21-22/0976 dated January 25, 2022, India-Ahead Private liable in any manner, directly or indirectly, for views or opinions
Equity Trust, a SEBI registered Category II AIF vide SEBI Reg. No.: expressed in this analysis or the contents or any systemic errors
IN/AIF2/21-22/0980 dated January 27, 2022 and Abakkus India or discrepancies or for any decisions or actions taken in reliance
Equity Trust, a SEBI registered Category III AIF vide SEBI Reg. No.: on the analysis. Abakkus does not take any responsibility for any
IN/AIF3/23-24/1326 dated August 9, 2023 under SEBI (Alternative clerical, computational, systemic, or other errors in comparison
Investment Fund) Regulations, 2012 as amended from time analysis.
to time and the Circulars and Guidelines issued there under
from time to time collectively referred as the SEBI Registered There can be no assurance that future results, performance or
Intermediary. The branch office of Abakkus situated at IFSC-GIFT events will be consistent with the information provided in this
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(IFSCA/FME/II/2022-23/041) under IFSCA (Fund Management) of the future/assured performance. Any decision or action
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Disclaimers
June 2024
March 2025

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Fund.
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