ASK India Select PMS: A Complete & Comprehensive Review

“Investing is not about beating others at their game. It’s about controlling yourself at your own game.”      – Benjamin Graham

ASK Group is a well-known financial services group that has been around since 1983.

They specialize in helping wealthy families in India with their wealth and investment management needs.

They offer a range of services such as research-based investment management, asset management, private equity, wealth advisory, and multi-family office services.

ASK believes in making the most out of one’s wealth by using expertise, following a disciplined approach, and upholding values such as quality, long-term focus, knowledge and research, risk management, and transparency.

In this article let’s discuss ASK India Select PMS(ISP) one of their Multicap PMS.

Let’s look at the constituents of this PMS and analyse its past performances with various benchmark indices and decide if this is a suitable investment option.

But first, make sure you have a solid understanding of the Portfolio Management Scheme before reading this article.

Let’s get started!

TABLE OF CONTENTS

1.)Overview of ASK India Select PMS
2.)Fee Structure of ASK India Select PMS
3.)Market Cap of ASK India Select PMS
4.)Sector Allocation of ASK India Select PMS
5.)Top Holdings of ASK India Select PMS
6.)ASK India Select PMS: Whom is it for?
7.)How do they select the Stocks?
8.)ASK India Select PMS Returns Vs Benchmark Returns.
9.)ASK India Select PMS Portfolio Returns vs BSE500 TRI.
10.)ASK India Select PMS Portfolio Returns vs NIFTY 50.
11.)ASK India Select PMS vs Other Investment Options

• ASK India Select PMS vs Active Mutual Funds
• ASK Growth vs ASK ASK India Select PMS
• Marcellus Rising Giants PMS vs ASK India Select PMS
• Marcellus Kings of Capital PMS vs ASK India Select PMS

12.)Tax Considerations in PMS
13.)ASK India Select PMS vs Other Investment Options – Review Conclusion
14.)Final Verdict of ASK India Select PMS: Good or Bad?

1. Overview of ASK India Select PMS:

Strategy	Category	Fund Manager	Age	Corpus (in Cr, approx)	Benchmark	Returns SI (CAGR)	Stocks	Sectors
ASK India Select Portfolio (ISP)	Multi Cap	Mr. Chetan Thacker	13Y 6M	3531	BSE 500 TRI	15%	24	8

• It is a long-term-oriented portfolio that seeks to provide capital appreciation by investing in a diversified portfolio of Indian equities.

• The minimum investment amount is ₹ 50 lakhs in ASK India Select PMS.

• Using a long-term investment strategy. The two main goals of this ASK India Select PMS are preserving capital and generating capital appreciation.

• This is accomplished by making long-term investments in high-quality companies with strong growth potential.

The investment strategy of ASK ISP is based on several key factors:

• Size of opportunity: Investing in companies that operate in large markets with significant growth potential.

• Earnings growth: Focusing on companies with a proven track record of delivering strong earnings growth.

• Quality of the business: Investing in companies that have solid business fundamentals and a competitive edge.

• Price-value gap: Seeking out companies that are trading at favorable valuations compared to their intrinsic value.

• Good management: Giving importance to companies with competent and capable management teams, which is a common factor across all stocks in the portfolio.

Please refer to the official brochure(pdf) of ASK India Select PMS for more details.

2. Fee Structure of ASK India Select PMS:

Fee Structure	Fee
Fixed Fee	2.5
Variable Option 1	1.5% fixed + 20% above 8% hurdle
Exit Fees	3yr(1%)

Further, there are many other charges which are charged by the company. Below are the charges levied.

Management Fees: Typically, clients are assessed management fees in accordance with the commission structure they choose.

Upfront Charges: The Ask PMS likewise imposes charges up in advance. This kind of fee is comparable to an advance payment. The charges must be paid in advance and it ranges between 0.8% to 1.8% of the total asset value.

Brokerage charges- The Ask PMS solution also charges brokerage fees based on the whole transaction made by the portfolio manager. The brokerage fees range from 0.01% to 0.035% of the entire transaction amount and must be paid.

Custodian Charges: The organization that offers portfolio management solutions also levies custodian fees on each of its customers. Typically, custodian fees are between 0.2% and 0.3% of the entire asset value.

Depository Charges: The depository costs typically range from 0.11% to 0.21% of the asset value total.

3. Market Cap of ASK India Select PMS:

4. Sector Allocation of ASK India Select PMS:

5. Top Holdings of ASK India Select PMS

6. ASK India Select PMS: Whom is it for?

• • If you are willing to invest a minimum amount of ₹50 lakhs and do not have any immediate financial requirements.

• • If you have a long-term investment horizon, which enhances the potential for higher returns.

• • If You have a deep conviction and trust in the growth potential of the Indian finance space and the Indian consumption sector.

• • If You have a high tolerance for risk.

• • If you can be a conservative investor and consider Market cyclicity as underperformances can lead to diminished returns

• • If you can have faith in the PMS and fund manager throughout the journey to achieve your Financial Goals.

7. How do they select the Stocks?

The investment process revolves around the systematic filtering of companies from a broader universe, guided by specific criteria that ASK prioritizes.

Step 1:

Top 500 stocks are taken and the Filter of companies that have greater than 25% promoter/family holding is applied.

Step 2:

Minimum profit before taxes of INR 100 Cr (USD 14 Mn) (at the time of 1st investment) is further applied to filter out underperforming conglomerates. This filter reduces the number of companies to 410 that are predominantly entrepreneur and/or family-owned businesses with good growth history.

Step 3:

A minimum Return on Capital Employed (ROCE) of 25% in the preceding Quarters is assessed and the companies are filtered further.

Step 4:

Two more filters are applied for the selection of stocks

a) Earnings growth of at least 20 to 25 percent, without capital dilution during the next three to five years

b) A 20% price-value difference (margin of safety).

This filter reduces the number of stocks to 92

Step 5:

Finally, an investment approach is developed that consists of 20-25 carefully selected businesses. These businesses are chosen based on a combination of their overall qualities, sufficient diversity, and a minimum margin of safety.

8. ASK India Select PMS Returns Vs Benchmark Returns.

Now comes the most interesting part where we find out the PMS’ performance against its benchmark and other indices.

Returns (%)	1M	3M	6M	1Y	2Y	3Y	5Y	10Y	Since inception return
ASK India Select Portfolio (ISP)	5.40%	10.30%	-1.10%	7.20%	5.50%	18.90%	8.30%	16.80%	15%

From the above illustration, it is clear that the India select portfolio has performed considerably well over the longer term. It has given good returns to those who have been invested for more than a decade in the range of 15-16%.

ASK India Select Portfolio Cos Average Performance over last 5 years (CAGR) as of FY22
Sales	Operating Profit	PBT	ROCE	PAT
17%	19%	17%	36%	19%

The metrics mentioned above demonstrate the consistent performance of the selected companies, serving as a testament to the effectiveness of the filtration criteria employed.

9. ASK India Select PMS Portfolio Returns vs BSE500 TRI.

Now let’s benchmark with the BSE 500 TRI, which is the benchmark chosen by the PMS.

On benchmarking with the BSE 500TRI, we see 2 different patterns here.

Though the PMS has shown considerable growth over the longer term, The PMS has underperformed the BSE 500 benchmark handsomely in the medium-term period.

This is a cause of concern as to why the PMS wasn’t even able to beat the benchmark.

If returns are considered as one benchmarking parameter, it is also important to compare the drawdowns (the decline in value from peak to trough) of this PMS portfolio with the benchmark.

The drawdown of this PMS is comparatively lower than that of the BSE 500, indicating a strong portfolio.

10. ASK India Select PMS Portfolio Returns vs NIFTY 50.

Now, let’s examine how this PMS performs in comparison to the NIFTY 50.

The performance of the NIFTY 50 benchmark is like that of the BSE 500 TRI index. While the PMS shows strong performance over the long term, it has significantly underperformed the NIFTY in almost all other timeframes.

Even during the post-COVID period when there was a notable rally in stocks, the constituents of this PMS did not experience the desired level of upward movement. As a result, the PMS delivered lower returns in the medium-term timeframe.

11. ASK India Select PMS vs Other Investment Options

• ASK India Select PMS vs Active Mutual Funds

Comparing PMS returns with mutual funds can provide investors with a point of reference and a benchmark for evaluating the performance of their investments.

Since ASK ISP is classified as a multicap fund, it would be wise to compare it with the actively managed Multicap funds.

Scheme Name	AUM	1M	3M	6M	1Y	2Y	3Y	5Y	10Y
Quant Active Fund Multi Cap Fund	4787.09	3.10%	11.48%	3.96%	24.13%	14.50%	37.75%	23.07%	22.59%
Invesco India Multicap Fund	2586.64	5.09%	14.31%	12.18%	26.56%	10.30%	27.97%	14.17%	19.80%
Sundaram Multi Cap Fund	1985.7	3.93%	12.02%	10.97%	22.10%	12.76%	28.35%	14.40%	17.87%
Nippon India Multicap Fund	17440.71	4.65%	16.68%	17.15%	36.09%	23.82%	38.61%	17.81%	17.82%
ASK India Select Portfolio (ISP)	3531	5.40%	10.30%	-1.10%	7.20%	5.50%	18.90%	8.30%	16.80%

As expected the actively managed mutual funds win over the ASK ISP PMS in the longer timeframe.

• ASK Growth vs ASK ASK India Select PMS.

If you have considered investing in ASK Growth PMS, a similar Multicap PMS from the house of ASK Financials, we have you covered. You can delve into our comprehensive review of ASK Growth PMS and have a comparative study with this PMS as well.

• Marcellus Rising Giants PMS vs ASK India Select PMS

This Marcellus PMS “Rising Giants” aspires to invest mostly in high-quality mid-sized businesses with market capitalizations of less than Rs. 75,000 crores, primarily in the Rs. 7,000 crores to Rs. 75,000 crores range.

Marcellus Rising Giants PMS: Decoding with a Comprehensive Evaluation & Review

• Marcellus Kings of Capital PMS vs ASK India Select PMS

The entire spectrum of financial service providers is represented by the Marcellus “Kings of Capital” PMS, including lenders (banks, NBFCs, and home finance businesses), life insurers, general insurers, and asset managers/brokers.

Marcellus Kings of Capital PMS: An In-Depth Analysis! Is It Worth Investing?

12. Tax Considerations in PMS:

The earlier-mentioned returns are pre-tax returns, and after factoring in the impact of capital gains tax, the actual returns will be lower, resulting in a distinct post-tax return value.

When compared to mutual funds, Portfolio Management Services (PMS) are generally less tax-efficient, potentially leading to a higher tax liability for investors.

Investors need to be mindful of the tax implications while evaluating PMS returns, as mutual fund investors may enjoy certain tax advantages not available in PMS.

Additionally, the impact of dividend income and associated taxes is often overlooked. Dividends are considered part of an investor’s income and are subject to taxation, accordingly, further reducing the net amount received by the investor.

Here comes the most important part.

Should I go for this PMS, or shall I opt for any of these actively managed funds?

Let’s conclude this by considering all the above-mentioned points and arrive at a conclusion.

13. ASK India Select PMS vs Other Investment Options – Review Conclusion

As we have previously discussed,

We compared ASK India Select PMS with Mutual Funds and found out that actively managed Multicap funds give better returns in the longer timeframe.

We tend to overlook the aspect of pre-tax returns and post-tax returns.

If we calculate the capital gains tax then the post-tax return value of any Portfolio Management Service will be much lesser than Mutual Funds.

So it is better to invest in Mutual Funds than in any PMS unless you’re an extremely high net-worth individual who has nothing to lose!

14. Final Verdict of ASK India Select PMS: Good or Bad?

By now, it is widely known how prominent ASK Financials has become in the realm of PMS.

Through their robust research-based investment management, asset management, private equity, and wealth advisory services, they have established a formidable reputation for themselves.

This PMS is a good option for investors who are looking for a long-term-oriented, diversified portfolio with the potential for capital appreciation. However, there are a few things to keep in mind.

• • The primary concern lies in the underperformance experienced in recent years. While it is normal for funds or PMSs to have some periods of underperformance, an alarm is raised when this underperformance persists for nearly five years as in this PMS.

• • Comparing the returns after deducting the taxes, fees, and the several brokerages with the returns from the mutual funds after the expense ratio, the returns from PMS seem to be diminutive.

• • Ideally, the PMS should have generated more returns to account for these fees but that’s not the case to be.

• • One general concern with PMS is the lack of liquidity, which can deter investors who prioritize easy and quick access to their funds. This lack of liquidity often makes PMS a less popular option among investors seeking more immediate liquidity.

Going by all these points, it is better to stay away from this PMS. You can check out other outperforming PMS and actively managed funds for better alpha.

Numerous reviews on social media platforms such as Facebook, Twitter, Quora, etc., may contain exaggerated opinions regarding ASK ISP PMS.

It is crucial to exercise caution and not rely solely on amateur advice, which can potentially lead to financial losses.

Do consult a professional financial planner to avoid pitfalls in your investment journey and to safeguard your hard-earned money.

Happy Investing!