Conservative & Concentrated
Value investment strategy managed through market cycles
WHO WE ARE
GreatBear began operations when Mr. Saptarshi Das shifted base back from London, UK to India in 2015. The essence of GreatBear is built on the cognizance that investing is not just an act but a way of life.
GreatBear brings to the fore, in every act of its investment operations, simple life principles of prudence, humility, continuous learning, hard work, deep research, patience, and foremost, persistence.
We want to allocate capital to those companies which display similar attributes: companies which have sustainable innovation, present significant margin of safety, and have very high shareholder alignment.
We are value investors. We think long term and do extensive on-ground due diligence to identify opportunities.
Stewardship is a word that means taking care of something. It’s overseeing something on behalf of someone else and acting in a way that keeps the owner’s best interests at heart.
When you entrust GreatBear with your capital to invest for your future, we take stewardship of your investment — and so it is our duty to look after it with the utmost care.
When it comes to investments, there may be short-term ups and downs in the markets from time to time. But our responsibility is to help your investment grow over time, while supporting long-term benefits for the economy, the environment, and society more broadly.
We are value investors and broadly follow a natural ESG framework and avoid sin stocks.
— Saptarshi Das, CFA, Portfolio ManagerPRINCIPLES
We operate a culture of true partnership. Our investor clients are our partners and our fortunes are directly proportional to theirs. Most of our personal wealth is invested alongside them.
Our effort is to survive the vicissitudes of financial markets and economic conditions — not collide head-on with them. We aim for decent returns, not a roulette game.
We are not in the business of buying a company just to sell it later. We would like to grow our wealth with the fortunes of a good company held long term.
We take immediate action when we have made an error — whether from information processing errors, new information, or plain simple oversight.
We will always be fully transparent about our operations. Every investor, however small or large, has equal right to all information and service.
We communicate bad news first. Good news can always wait. If there are no suitable capital allocations, we happily use money market instruments to wait.
We will never enter into agreements with third parties which have incentives misaligned with our investors — however strong or fair the incentive might be.
We want us to be a happy bunch of people, both investors and the management team. We treat everyone with dignity, respect and care in all our dealings.
We will not enter into confidential binding agreements that might jeopardize trust. No special treatment given to any single party.
INVESTMENT APPROACH
We invest in businesses, not a ticker. We don’t subscribe to the philosophy that only buying low-multiple stocks is value investing. Price is important, but we believe the largest potential value exists in cash-flow-generating, innovation-driven businesses making earth a more sustainable place for future generations.
We also believe in ‘responsible capitalism’ — capitalism in which stakeholder interests are largely aligned with shareholder interests, and profit maximization is directly proportional to human value maximisation.
GreatBear is a long-only value investor. We feel that market irrationality about the price of a business may have no upper bound — we don’t particularly like that exposure from shorting.
We look at a business with a private equity approach. Buying stock is essentially an opportunity to identify mispriced assets and seek re-rating while growing with the fortunes of the company.
Capital allocation is our main job.
RESEARCH
Continuously research companies and identify those which show significant difference between value and price.
Understand industry microeconomics to form a view on the future company-specific business picture. We need at least one unique key insight about the business.
Understand if the drivers for re-rating exist.
Buy only if valuations are opportune. We typically never buy at more than 10x P/E, 3x market cap to sales, or 0.2 PEG. We are looking for considerable margin of safety.
Is the business increasing or maintaining its market share?
Does the company show stable or growing operating margin?
Is the company moving up the value chain in its products or services?
Is there evidence of organic sustainable growth?
Is there enough management stake to minimise agency problems?
Is the industry growing with freedom from excessive government interference?
Is the business improving people’s lives?
DUE DILIGENCE
GreatBear’s view is that management quality is what management does or has done — rather than what they say or the reputation they have.
MARKET CYCLE
Market cycles are identified by analysing stock market valuations and interest rate cycles
CONSTRUCTION
We can buy low liquidity stocks, and we don’t limit ourselves to a minimum market cap threshold.
The behaviour of the representative NAV is continuously monitored through various market environments, forming the primary qualitative basis for price risk behaviour.
Sometimes there is new information, error in analysis, or oversight which may change the thesis. Long term investing is a thought process, not sticking to an investment to prove a point.
News sources, research reports, corporate actions, or simple discovery may unearth ideas with potential for inclusion.
PERFORMANCE
Trades at a relatively low P/E (≈11–15x). Strong revenue expansion. Positioned in the growing Indian solar/renewables sector with tailwinds from energy transition.
Low valuation (P/E ~9x). Strong ROE (~19%) with significant improvement in asset quality. One of the best run public sector banks.
Attractive P/E (~11x) vs sector average (~62x). High ROCE (~30%) and ROE (~25%). Active in niche cancer drugs with pipeline potential.
COMPETITIVE EDGE
Self-imposed constraints to conform to value investing. Stock selection is the key and only driver of excess portfolio returns.
No leverage and no portfolio shorting. No aggressive trading done in the portfolio.
No stylistic bias, no over-diversification. Few portfolios in Indian/Asian equity space go down the market cap spectrum as GreatBear does.
We strive to do the hardest thing in investing — wait. We do not believe we have any skill in market timing.
GreatBear Ventures — Private Wealth Management for HNI entrepreneurs and family offices. Discretionary fund advisory.
Octopus Investments ($7 Bn AUM), FQS Capital, Visiongain Global — London. Portfolio management of a $75 Mn absolute return fund. Overseeing $300–500 Mn allocation to Emerging and Asian markets.
Masters in Management — Imperial College London
Mechanical Engineering — Gujarat University, India
TERMS
Setup Fee: ₹5,000 Resident Indians · $5,000 FPI corporates · $1,000 FPI HNIs
GET IN TOUCH
Saptarshi Das, CFA
Ahmedabad, India