ICICI Prudential PMS Contra Strategy has celebrated its five-year anniversary. This investment offering from ICICI Prudential Portfolio Management Services takes a contrarian approach by investing in equity stocks that are currently out of favor in the market but are expected to perform well in the long run. The portfolio may also include stocks from sectors with high entry barriers, sectors experiencing consolidation, or companies in special situations.
Launched on September 14, 2018, ICICI Prudential PMS Contra Strategy has reported strong performance over the years. According to a statement, a lump sum investment of Rs 1 crore at the time of inception would have grown to approximately Rs. 2.4 crore by September 14, 2023, with an annualized return of 20%. In comparison, a similar investment in S&P BSE 50 TRI would have yielded an annualized return of 14%, reaching approximately Rs. 1.8 crore.
Anand Shah, Head of PMS & AIF Investments, highlighted the investment framework’s core belief that companies create wealth, not markets.
Over the past five years, the Contra Strategy has primarily focused on manufacturing and related sectors to generate alpha. The statement noted that manufacturing sectors such as metals, industrial products, and auto ancillaries, as well as manufacturing-related sectors like logistics, corporate banks, and utilities, presented attractive investment opportunities with reasonable valuations and strong earnings potential.
Additionally, the strategy’s decision to go underweight on Information Technology (IT), Consumer Goods, and the Pharmaceutical sector contributed to its strong fund performance.
ICICI Prudential PMS Contra Strategy’s success highlights the effectiveness of its contrarian approach and sector-focused investment strategy.
