Author : Aequitas

Aequitas Alternative Investment Fund: Review, Performance, Returns, Strategies, Risks, Benefits

What is an AIF or Alternative Investment Fund?

Alternative Investment Fund meaning or AIFs in India means any fund established or incorporated in India which is a privately pooled investment vehicle which collects funds from sophisticated investors, whether Indian or foreign, for investing it in accordance with a defined investment policy for the benefit of its investors.

What are the types of Alternative Investment Funds?

AIFs in India are categorised into three types based on their investment strategies. The types of AIF are:

• Category I: These funds invest in startups, SMEs, infrastructure, and social ventures, with the aim of generating positive spillover effects on the economy.
• Category II: These funds include investments in private equity funds, real estate funds, distressed asset funds, etc.
• Category III: Primarily focused on hedge fund strategies, including trading in listed or unlisted equities and derivatives.

Aequitas AIF 
Aequitas Equity Scheme 1 is a SEBI registered Cat 3 Alternative Investment Fund that invests in Indian public equities, with a focus on identifying multibaggers. With world-class alternative investment services in India, Aequitas seeks to create long term wealth for investors. Aequitas Equity Scheme is a portfolio of 20-25 industry leaders which ensures that the portfolio has the right mix of concentration and diversification.

To know more about Aequitas AIF, read about Aequitas Equity Scheme 1.

Aequitas’ AIF Strategy

At Aequitas, we believe in focusing on what we do best – instead of chasing after the trending strategy. This is why we follow only one strategy, across our products. Our strategy relies on 3 pillars, namely:

• Value: At Aequitas, we are sticklers for value. We aim at investing in stocks which trade at a significant discount to their intrinsic value. For better ROI with our alternative investment funds, we aim at buying the best companies in industries out of favour. For us margin of safety remains the cornerstone of our investing philosophy.
• Growth: The markets reward growth by assigning higher PE multiples to growth companies. However, growth itself is cyclical and historical growth is already reflected in the current stock prices. For providing best alternative investment services in India, we seek to identify industries which are likely to do well in the future, and that typically comes in sectors and industries which have been out of favour for a number of years.
• Contrarian: Contrarian investing doesn’t mean doing the opposite of others but rather doing things differently from others. To find multibaggers, one cannot look in places that have already been discovered. The real oasis of potential lies in undiscovered sectors – which is exactly what our expert Alternative Investment Fund Managers do at Aequitas. Sectors that are not yet ‘hot’, are the ones that attract our attention.

Benefits of Aequitas’ AIF:

AIF is an attractive investment option for investors who aspire to receive multibagger returns. Some of the benefits of Aequitas’ AIF are-

1. Trust (skin in the game): All key employees of Aequitas, including the founders and top management, are invested in the AIF fund. This is an indicator of the level of faith we have in our own offering.

2. One on One engagement with clients: We believe in providing a one-stop solution to investors seeking to park their surplus funds in lucrative assets.

3. Pooling of Resources: AIF consists of privately pooled investment funds that invest in private equity, venture capital, hedge funds, and managed funds. Aequitas AIF parks its funds in the Indian listed equity market and offers investors units corresponding to the fund invested. Pooling of resources benefits all investors in the cycle. Taxation happens at the fund level that enables an investor to reap benefits without worrying about taxes.

4. Wealth creation: Aequitas AIF is investor-centric and believes in long term wealth creation for its investors.

5. Exceptional research team: Qualified and experienced portfolio managers backed by a robust research team manage equity portfolios on behalf of clients instead of clients managing themselves. Our highly qualified team of research analysts indulge in primary research. A company is best understood by its balance sheet and annual reports. An in-depth study of the fundamentals along with various screeners help us pick top performing stocks that while they are below their intrinsic value. A series of con calls with companies, interaction with management past as well as prospects help us indulge in our stock picking.

6. Diversification: We believe in diversification of our portfolio to hold stocks from varied sectors to mitigate risk. Our portfolio consists of about 16-20 stocks with the potential to create wealth for the investors.

Minimum Investment Requirements

The minimum investment in AIF in Indian equity offered by Aequitas is INR 3 cr. We have a fortnightly series for allotment. Depending on the series in which the investor transfers the fund, they would get units allotted to them at the face value of 100.

AIF Risks:

Aequitas’ key investment philosophy is centred around the concept of “Margin of safety”. Where we look at capital preservation, before speculating capital growth.

Our AIF is a CAT 3 long only fund and has a one year lock-in. It invests in Indian public equity. The fund can have periods of under-performance, as it was witnessed during events like COVID Pandemic, Russia-Ukraine War, that can have a significant impact on the world economy and therefore, portfolio’s returns. The fund is focused on creating absolute wealth and has relatively lower composition of stocks in the benchmark indices.

How to invest in Aequitas AIF:

If you believe in the power of compounding and you are in alignment with our investment philosophy, then the on-boarding process is fairly simple and straightforward. Physical and digital on-boarding of the investor is possible, depending on prerequisite fulfilment. The investor can come as an individual or as an entity. Depending on the investor structure, a basic set of document requirement will be shared with the investor.

To know about our past performance or any other details related to our Alternative Investment Fund, there are multiple ways in which you can reach out to Aequitas team:

You can schedule a connect with us or drop your details on our website chat-bot or give a call +91 72080 42953 or drop an email to info@aequitasindia.in

Tax Implication

The regular taxes like Short-term tax gain, Long-term tax gain & Dividend Tax are computed as applicable.

Additionally, taxation happens at the fund’s end, unlike PMS. Therefore, it is a relatively hassle-free investment solution. When an investor redeems, the amount that is credited to their account is net of any further liabilities.