Pleased to release our latest newsletter. I have presented analysis to evaluate current sentiments and ground reality. I have rarely seen such a big divergence between the two. Hope you find some value. sageoneinvestments.com/sageo…

“ 𝐎𝐮𝐫 𝐀𝐔𝐌 𝐫𝐞𝐩𝐫𝐞𝐬𝐞𝐧𝐭𝐬 𝐥𝐞𝐬𝐬 𝐭𝐡𝐚𝐧 𝟎.𝟕% 𝐨𝐟 𝐭𝐡𝐞 𝐭𝐨𝐭𝐚𝐥 𝐦𝐚𝐫𝐤𝐞𝐭 𝐜𝐚𝐩𝐢𝐭𝐚𝐥𝐢𝐳𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐨𝐮𝐫 𝐩𝐨𝐫𝐭𝐟𝐨𝐥𝐢𝐨 𝐜𝐨𝐦𝐩𝐚𝐧𝐢𝐞𝐬, 𝐚𝐧𝐝 𝐰𝐞 𝐚𝐫𝐞 𝐜𝐨𝐦𝐟𝐨𝐫𝐭𝐚𝐛𝐥𝐞 𝐮𝐩 𝐭𝐨 𝟏.𝟓%,” Said 𝐌𝐫. 𝐒𝐚𝐦𝐢𝐭 𝐕𝐚𝐫𝐭𝐚𝐤 Gain valuable insights from the 𝐅𝐨𝐮𝐧𝐝𝐞𝐫 & 𝐂𝐈𝐎 𝐨𝐟 𝐒𝐚𝐠𝐞𝐎𝐧𝐞 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 𝐌𝐚𝐧𝐚𝐠𝐞𝐫𝐬 𝐋𝐋𝐏 on India's evolving investment landscape, key growth sectors, and a disciplined long-term investment approach. 𝐑𝐞𝐚𝐝 𝐍𝐎𝐖: resources.pmsbazaar.com/fund…? #invesmentinsights #investments #fundmanager #finance #portfolio #sectors #pmsbazaar

Was my pleasure this morning to be on @ETNOWlive with @AyeshaFaridi1 @sajeetkm @hershsayta . Thoroughly enjoyed sharing my views on current environment, areas of attractive segments and pockets of valuation. ... youtu.be/g_dZu6bZ168?si=2FVD… via @YouTube

I deeply admire @SamitVartak for the person he is. He is the antithesis of what a typical fund manager should be like and maybe that is why he has succeeded both in markets and life. Watch from 1:10 to find out why. youtu.be/-nzo0RcwQkg?si=wXkD… via @YouTube

Amazing podcast. Excellent insights on investing & mrkt cycles. Last part on spirituality is particularly precious like a kohinoor diamond 💎. Perfect perspective 🎯💯✅ on happiness & lack of correlation with immense wealth. Need to have free mind. Last part is a must watch 👌

Was absolutely a pleasure to be on podcast with @_soniashenoy . Enjoyed a very in depth discussion on my investment journey, investment process and for whatever it's worth on my life journey. I have discussed my successes and failures. Please take my views on timing of entry/exit and specific stock examples with a handful of salt as it's very subjective based on my analysis which can go completely wrong. Focusing on the process may be little more accurate. This was probably my longest podcast and refreshingly Sonia also touched upon things beyond investment and money. I have shared my way of living life and looking at various aspects of life. Again this is what's worked personally for me. Hope it adds some value. youtu.be/-nzo0RcwQkg?si=nIEP… via @YouTube

Enjoyed my conversations on the markets, attractive investment themes available currently and more. Hope you find some value. @nimeshscnbc @_prashantnair @Nigel__DSouza @Reematendulkar Editors Discuss The Week Gone By & Road Ahead For The Markets | Editors'... youtu.be/yoreXz7hkKo?si=TzQn… via @YouTube

P/B ratio has historically been a more reliable and stable valuation metric for predicting future returns compared to alternatives such as P/E or EV/EBITDA. I had demonstrated this through correlation analysis in an earlier investor memo. The chart below tracks the P/B ratio (blue line) of the Nifty Smallcap 100 Index against the 25th percentile of its trailing 5-year P/B range (orange line). In simple terms, when the blue line falls below the orange line, the current valuation is in the lowest quartile of the past five years. Since P/B is broadly proportional to ROE, the structural improvement in index ROE—from ~8–12% in the previous decade to ~15% currently—has led to a gradual upward shift in the orange line over time. Notably, for the first time since the COVID crash, the current P/B has moved below this 25th percentile threshold. Historically, similar instances—during the 2011–2013 downturn, Q1 2016 correction, and the COVID crash—have been followed by strong returns over the subsequent 1–3 years. This does not imply that markets have bottomed, nor does it guarantee short-term gains. In an event-driven environment, especially with geopolitical risks such as an escalation in war, markets could decline further by 10–20%. However, what can be said with a reasonably high degree of confidence is that forward-looking returns over a 1–3 year horizon from such valuation levels have historically been better than average.

Absolute treat listening to @SamitVartak Fundamental backed market views in such testing times hit different, this is the kind of signal worth tuning into right now Small cap cycles, P/B trends, mid & small cap resilience vs Nifty in this crisis, beautifully broken down

[No Paywall] Watch Samit Vartak, CIO at SageOne Advisors uncover historical smallcap cycles with signs of current one bottoming out. In this insightful session, Samit covers: - Smallcap cycles: Worst seems behind with good setup for an outsized returns (avg. 64% upside within a year). - Seasonality: How Jan-Feb is the worst period while April-May been the best for small caps. - Resilience: Relative strength versus large caps in recent fall. - Valuation: At 25th Percentile on P-BV basis, highly lucrative (similar to COVID bottom). - Potential themes to participate for upcoming bull market. Given the doom & gloom around small caps, IIC is offering free access to this session. Link in the comment.

In my experience, this is probably the first time the Mid & Small cap indices have outperformed the Nifty 50 during a crisis time. It's also extremely rare to see the Mid & Small cap indices (avg of the two) beating the Nifty 50 near the bottom of the cycle. Their avg CAGR has outperformed during the last two tough years as well as all the below trailing years. I am not that surprised as their balance sheet, P&L and cash flow quality has substantially improved post COVID. I believe the biggest multi-baggers will emerge from this space as the earnings growth differential will be significant going forward. Because of the quality differential today vs during pre-COVID period, I would be surprised if their valuations correct to levels seen during the previous crashes. We probably have the best corporate quality and least stressed financials currently compared to any other previous big crisis.

Link to today’s interview on NDTV Profit. Short term market movements or how events play out are impossible to predict. India has many wonderful entrepreneurs who are tirelessly working towards creating world class companies. Much easier to find such businesses and betting on them. @niraj_shah Indian Markets Bottoming Out? Market Expert Reveals What To Buy Now youtu.be/J0J1tLFpCz4?si=hfv0… via @YouTube

Given that oil price is the biggest impact India and many other countries are facing today because of the war, a coordinated effort to reduce fuel usage may help reduce major impact. During COVID the world went into a complete shut down and oil prices had dropped to below $20 and futures had crashed to -$37 in April 2020. Maybe we can introduce partial work from home and keep industrial activities open, and I am sure this itself (if done globally) will help correct oil prices significantly. For India will help our trade deficit as well as lower pressure on our currency in addition to lowering input costs for many industries thereby reducing impact on profitability. COVID helped us develop and test technologies and platforms that made work from home easy and this may be a very good time to use them until war uncertainties remain. @narendramodi @nitin_gadkari @nsitharaman

One more wonderful book by @safalniveshak with compilation of gems from practitioners on various key aspects of successful investing. I was fortunate to contribute a chapter. Congratulations on the book Vishal and all the very best.

Just watched this old 2017 video of @SamitVartak sir. Extremely valuable insights. Truly a paisa vasool video. Must watch. youtube.com/watch?v=-H_0xZHm…

Looking forward to the conversation

Earnings growth picture for Dec'25 quarter vs Dec'24 quarter. Wtd Avg (growth in sum total earnings) is significantly better for the mid and small cap universe. Small cap has an exceptional earnings from Kiri Ind with 5000 cr plus (vs 177 cr year ago) which skews the growth much higher than normal. If you remove that, the wtd avg growth is 14.9%. Median growth reduces influence of such outliers or exceptional items and hence gives a better directional picture. Over all growth is good but nothing exceptional. I believe we should see much improved growth in the Mar'26 quarter as sharp pick up in economic activity (as covered in my last memo) started in the month of December 2025.

As seen in the table from my latest memo, drawdowns in small caps during the January–March period—measured from the January peak to the February/March trough—are not an exception; they are a recurring feature of market cycles. Just as consistently, these phases have been followed by sharp recoveries once the market establishes a bottom in February or March. Current sentiment is such that investors are overly focused on the negatives, making the environment appear so foggy that positives have become invisible. This fog, as always, will eventually lift. While market bottoms and the depth of drawdowns can never be predicted, it is highly probable that market levels a few months from now will be disproportionately higher. Unfortunately, short-term declines are unsettling for investors, causing many to step aside and miss the eventual strong upswing. In hindsight, this phase will look like an obvious opportunity. But while living through it, investors see only risks and landmines—never the runway for the next flight Post See new posts Conversation