MarketsMojo plans to enter mutual fund business

The Indian retail market is highly stock-specific. That’s why over 80–85 per cent of investors lost money despite the index returning 11–12 per cent over the last decade. The equity market is unorganised; for one, retail participation is lower. Second, many discount brokerage platforms encourage tip-based trading or single-stock picking. Third, all platforms lack relevant research.

Investors can only profit from a highly disciplined portfolio-specific approach than from being stock-specific. As a result, we’ve decided to enter the PMS space and later move into the AMC space. Rather than picking individual stocks, we aim to achieve consistent and disciplined returns through a portfolio approach.

For seven years, we have been running model portfolios for our subscribers. Part of this requirement stems from our investor base, who have witnessed failures when choosing stocks. They are not sure about when to enter or exit, what kind of market-cap or sectoral allocation to use, what kind of over-exposure can eat into returns and drop into the market, drawdowns they must take, etc.These scientific parameters are unattainable for most. As a result, a portfolio-based approach is ideal. We may be a new entrant in the PMS space, but we already manage around ₹6,500 crore through various model portfolios on our website over the last seven years.

Absolutely! I think SEBI’s minimum ticket-size requirement of ₹50 lakh limits retail participation in PMS. Hence, we are not entering the PMS space solely for HNIs. We are getting into a portfolio-advisory space with three licenses: an Investment Advisory License to advise portfolios under ₹50 lakh, a PMS license and a customised strategy license given our clients’ preference.

Our technical strength will allow us to easily distribute and manage the large client base on our platform. We do not anticipate a significant crowding of the HNI space. Our base ranges from retail to ultra-HNI; and today, we manage portfolios ranging from ₹5 lakh to ₹50 crore. Hence, we’re building on our previous successes over the last seven years.

Typically, people pay for high-quality services. MarketsMojo is the only advisory service in the country that hosts webinars six times per week to answer all client questions. Our service standards are exceptional and industry-defining and we have supported customers through tough times, earning their gratitude and long-term association.

Over 82 per cent of our subscribers are men. In terms of geographical spread, 84 per cent are resident Indian investors and the remainder are NRIs. Our offshore site also generates a lot of interest. Large family offices, offshore family offices and large institutions subscribe to our research, not only in India but also abroad, as part of their institutional play, white labelling our products for their ultimate consumption.

Demographically, tier-1 cities contribute 60 per cent while we are rapidly expanding our base in tier-2 and tier-3 with a 40 per cent share.

We began international operations a few years ago and have made small but rapid progress. However, we operate in 21 countries and research 60 per cent of the global market cap. We analyse every single listed company in these countries.

Our customers are mostly NRIs and foreign nationals researching stocks in their own countries. In the last year and a half, we’ve made good progress despite not marketing the product. However, the success that MarketsMojo had in its first two years of operations has been replicated in the global market in just six months.

We believe that Indian equities are fairly valued rather than overvalued. Since pre-Covid times, the net profits of publicly traded companies in India have increased double fold. Despite the Russia-Ukraine crisis, higher interest rates and inflation, India Inc.’s profits increased 10 per cent from the first half of 2022 to the first half of 2023.

Investors seek indicators of economic expansion. For example, FIIs invested ₹36,000 crore during Nov alone and since July 2022, approximately ₹90,000 crore in the Indian stock market.

The Indian economy has demonstrated remarkable resilience in the face of widespread global difficulties and will begin to experience tailwinds. We believe the Nifty will reach 22,200 by the end of 2023.

Equity is all about 3-5 years’ non-linear returns. 2022 was not a good year for equity investors. But 2023 will be. Hence, have patience and follow professional advice diligently. The Indian stock market will soar in the coming years and now is a great time to invest.