RMI™ India Growth 20

Style

India Growth 20 is a passive model with an average holding period of 12 months that is rebalanced once after 6 months. The model selects the top 20 growth components from among the mid-large cap universe and operate with an aim to maximize return through selecting the top winners of the market.

RMI Growth model selects the winners of the market and believes to generate return with the winners as it understands that something growing will keep on growing perhaps for a short term as the inertia will go on.

Components

Presently, 14 out of the selected 20 components have delivered a positive return. Top 4 components delivering more than 20% return since last rebalance (September) amongst the aforesaid 14 components are Aurobindo Pharma Ltd. (25.15%), Eicher Motors Ltd. (22.80%), Amara Raja B (25.19%) and Britannia Industries Ltd. (22.86%) All the four components are of large cap market and represent different industries with their market prices being steady and rising.

To analyse the four stocks, book-to-market ratio of the companies was considered, which is said to be less than one when overstated and vice versa. All the four components above have book-to-market ratios less than one, implying that the companies are overstated or expensive and their selection by the model is thus in line with its objective.