DHFL Pramerica PMS

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DHFL Pramerica PMS

7.3

Team Credibility

8.0/10

Returns

7.5/10

Offerings Range

7.0/10

Charges

7.0/10

Customer Support

7.0/10

Pros

  • Strong Team
  • Consistent Returns
  • Wide Strategy Range

Cons

  • Charges a Bit High
  • Limited Offerings

DHFL Pramerica PMS is one of the largest portfolio management services companies in the country. The company pays full attention to the stock fundamentals which makes the stock strong enough to get an excellent return from the investment portfolio.

Let’s understand whether it makes sense for you to take up the services offered by this firm.

DHFL Pramerica PMS Basics

DHFL Pramerica PMS is a well-established PMS house, founded by Mr Kapil Wadhawan in the year 1997. It is a business division of DHFL Pramerica an Asset Management Pvt. Ltd, an Asset management joint venture between DHFL and Prudential Financial Inc Financial of United States.

The company has designed its strategies in such a way that it can provide maximum portfolio management services returns to the investor clients. These strategies are for different types of investors who have different investment objectives and risk appetites.

DHFL Pramerica PMS has a wide range of analysts, researchers, and portfolio managers who take care of their business properly. They work with the goal of profit maximization and capital preservation of the clients.

The investment process of the company starts from picking stocks from the listed companies in the market and make a universe of the stocks on some basic criteria. From the universe, some stocks are selected by seeing the growth prospect and quality management, a portfolio is created.

DHFL Pramerica PMS offers a quality team of customer support who is available for the investors to solve their investment related queries.

In this review, we will try to cover each and every aspect of DHFL Pramerica PMS. We are going to cover the types of PMS, manager’s details, commission models, investment plans, the performance of the company, benefits, customer support and other related areas you must be aware of.


DHFL Pramerica PMS Types

DHFL Pramerica PMS tries its best to provide all products and services to their clients so that they feel full satisfaction as well as a comfort after joining the company. As you know that there are two types of PMS – one is Discretionary and another is Non-Discretionary and most of the PMS house offers both types of PMS.

This is the same case with the DHFL Pramerica PMS. This company also offers both types of PMS services.

Let’s discuss in brief:

Discretionary PMS:

Under this type, the portfolio manager takes responsibility for the investment portfolio of a client. The portfolio manager selects the stock and the strategy, according to the requirement of the client. He will take care of the performance of the portfolio also and will keep informing the client about the portfolio from time to time.

Non-Discretionary PMS: A client manages his/her own investment portfolio. And the client will be responsible for the performance of the portfolio as well. The fund manager can only suggest the profitable step to the client, but it will be the client only who will take the ultimate decision.


DHFL Pramerica PMS Manager details

The knowledgeable and experienced team of fund managers and researchers of DHFL Pramerica PMS is one the strongest point of the company. They are highly experienced in their field and have a track record of offering a superior performance of a portfolio to the clients.

Now, we are going to discuss the details of one of the best fund manager of the company:

EA Sundaram (Executive Director  & CIO-Equities):

EA Sundaram is one of the highly experienced investment officers in the company. He has more than 26 years of experience in the field of investing in the equity market in India. The experience of EA Sundaram includes portfolio management services, mutual funds, and family office investing.

He has experience of working with HDFC AMC as a fund manager, M3 investment managers Pvt. Ltd. as a portfolio manager, Zurich AMC, and SBI Fund management.

He has completed PGDM from IIM, Ahmedabad.

Mr Himanshu Upadhyay (Portfolio manager):

Mr Himanshu Upadhyay is presently working as a portfolio manager at DHFL Pramerica PMS. He is portfolio manager of Phoenix Strategy at DHFL Pramerica PMS. Mr Himanshu has 11 years of experience in which he has spent most of his career in the field of the equity market.

He has completed B.tech from NIT Hamirpur and PGDM from IIM, Kozhikode.


DHFL Pramerica PMS Strategic Details

DHFL Pramerica PMS has created two strategies which make them different from other PMS houses available in the market. These strategies are based on a certain philosophy of the company. So, the two strategies offered by the company are:

  • DHFL Pramerica Core equity Portfolio Strategy
  • DHFL Pramerica Phoenix Strategy

Let’s discuss each strategy one by one in detail.

DHFL Pramerica Core equity Portfolio Strategy (Multi-Cap Strategy):

DHFL Pramerica Core Equity portfolio strategy aims to increase the chance of investment performance. The strategy is created with the objective of providing the clients with a set of companies, purchased at a low price and ultimately minimizes the permanent capital loss to portfolio investors.

Investment process:

The investment process of the strategy consists of

  1. Create an investment universe of stocks based on some acceptable quality.
  2. Again, filter the universe on the basis of Management quality and growth prospect.
  3. On the basis of the valuation of each stock and exposure in the sector pick stocks to create an investment portfolio.

Following are the criteria to pick the company to the investment universe (Total number of stocks should be between 160-180 companies).

  1. Track-record of minimum 15-years: Generally, it is considered that a company completes one business cycle in 15 years. And in this one business cycle, a company learns a lot to run the business and realize a profit. So, as an investor, it is a big breath.
  2. A minimum of Rs.400 Crores revenue: Since the strategy takes multi-cap stocks in the account, the minimum threshold for the sales revenue should not be much higher than low and mid-cap stocks would not be able to achieve or seems difficult for them.
    A minimum of Rs.400 crore should be generated after one business cycle.
  3. Consistency in return generation: A consistency in return on capital employed reflects how efficiently the company is able to use the total capital employed. The return should be 20% or higher.
  4. Consistency in free cash flow generation: The free cash flow indicates the financial position of a company. Also, it shows how smoothly the company is being run.

Snapshot:

Benchmark: Nifty 500
Additional Benchmark: Nifty 50 Index
Target no. of stocks: 20-25 stock
Single Stock exposure (Maximum): 10%
Single Sector exposure (Maximum): 30%


DHFL Pramerica Phoneix Strategy:

DHFL Pramerica Phoneix Strategy aims to invest in those companies that can be affected very rapidly by the inflation in their business life cycle. The strategy helps in identifying the uptrend opportunities of the companies in their respective sector or businesses. It seeks to take advantage of the structural changes in the company or the market.

Investment Process:

The investment process of the company consists of:

  1. Creation of an investment universe by the screening of stocks based on acceptable quality.
  2. Filter the universe on the basis of management and growth prospect of the companies.
  3. On the basis of the valuation of each stock and their exposure in the sector, an investment portfolio is created.

The criteria on which the stocks are selected for the investment Universe (Total number of stocks should be between 350-380)

  1. Average ROE should be greater than 8% for the last 10 years: It is one of the best ways to measure the efficiency of the equity capital of the company being used. The higher ROE is thought to be better for the investors.
  2. Cash Flow should be positive in more than 6 years out of 10 years: If a company generates positive cash flow, it means the company is living within its means. It shows how smoothly the company is running its business.
  3. Market Cap: The Market Cap of the companies must be between Rs.750 CR to Rs. 20,000 CR.

Snapshot:

Benchmark: Nifty Free Float Midcap 100
Range of target companies: Both mid-cap and small-cap companies should be at least 75%.
Target companies: 20-25 stocks
Investment horizon: Minimum 3 years
Single Stock exposure (Maximum): 10%
Single sector exposure (Maximum):30%


DHFL Pramerica PMS Returns

The performance of the investment portfolio of existing clients of the company is very attractive and satisfactory. It has also beaten the performance of the Mutual fund return of more than 10 years. Here are some quick numbers:

  • 3-year return of DHFL Pramerica PMS is 9%,
  • the return is 11% for 5 years,
  • it is 13% for 7 years,
  • for 10 years the return is 14%, and
  • the return of THE portfolio for more than 11 years is around 15% CAGR.

Hence, we can see the performance of DHFL Pramerica PMS has been increased continuously. So, one can choose the company for getting the best return from the portfolio.


DHFL Pramerica PMS Investment plans

DHFL Pramerica PMS has offered some investment plans for the clients so that they can choose any plan according to their financial objective and risk-bearing capacity.

Just like most of the PMS houses, this PMS company also offers four investment plans with different names and ranges of the investment amount.

The following are the ranges and names of the investment plans:

  1. Bronze (₹25L to ₹50L)
  2. Silver (₹50L to ₹1 Cr)
  3. Gold (₹1Cr to ₹5cr)
  4. Platinum (₹5Cr & above)

Bronze: This the first investment plan offered by the company to the low-risk appetite clients. These categories of clients don’t want to invest more amount in portfolio investment without guarantee. So, they choose a minimum investment amount for investment.

Silver: This is the second type of investment plan offered by the company. As the name is, it holds a higher investment range than bronze. Those who want to invest between 50L to 1 Cr, can choose this plan.

Gold: Those clients who want to invest between 1Cr to 5Cr, to get a higher return can opt this investment plan. The plan is for moderately higher risk-bearing capacity clients.

Platinum: The plan suits the high profile investors who can invest above 5Cr and have a high risk -appetite.


DHFL Pramerica PMS Commission

The commission/Fee models of a PMS house give its clients freedom to pay the commission for the service received according to their convenience. And this is the reason DHFL also offers flexibility in the commission model offered to its clients:

Following are the models offered by the DHFL Pramerica PMS:

  • Prepaid commission model
  • Volume-based commission model
  • Profit-sharing based commission model

Prepaid commission model:

The model allows the clients to pay the commission in advance to the portfolio manager. Under this model, the commission is paid before getting the portfolio service. The percentage of commission is fixed by both parties.

In this model, a low amount of commission is paid in comparison to the rest of the models.

Volume-based commission model:

This is the second commission model offered by the company. In this model, the commission is paid on the basis of total transactions completed for the portfolio within a year. A percentage of the total transaction value is paid as a commission to the fund manager.

The commission is based on some other factors of investment as well as the market condition also. This model pushes clients to pay a high level of commissions.

Profit-sharing based commission model:

The commission is paid on the basis of the total profit generated from the investment portfolio. Generally, the higher amount of commission is paid under this model because the fund manager charges commission only after realization of profit so the risk associated with the profit is low.

The table shows the percentage of commission for different slabs of the investment amount:


DHFL Pramerica PMS Charges

Following are the other charges taken by the company except for the commission/fee:

  • Management Fee: This fee is charged by the PMS house on the basis of the model of the commission selected by the client and the fund manager.
  • Brokerage charge: This charge is taken on the basis of the total value of the transactions completed by the fund manager. The range of this charge is between 0.008%-0.028% of the total transaction value.
  • Upfront charge: It is just like a prepaid charge which is in the range of 0.9%-1.5%.
  • Custodian Charges: Generally, it is charged in the range of 0.28%-0.38% of the asset value.
  • Depository charges: This is charged by the DHFL Pramerica PMS in the range of 0.18%-0.28% of the total asset value.
  • Exit Load charges: This charge is taken on the total withdrawal amount within a year of portfolio creation. The range of the charge is between 1.1%-2.1% of the withdrawal amount. No charge is applicable to the withdrawal amount after one year of portfolio creation.

DHFL Pramerica PMS Benefits

If you decide to hire DHFL Pramerica PMS as your portfolio manager, you will get the following benefits:

  • An excellent team of fund managers who provides customized portfolio management services to the clients according to their financial objective and risk appetite.
  • The company offers two unique strategies with the different time horizon of return and different method of selection of stocks in the portfolio.
  • Superior performance has been awarded to the existing clients and because the company works on the same investment philosophy, the expectation of great performance remains the same for the new clients also.
  • Offers three different types of commission models and four types of investment plans so that a client can pick according to their need and choice.
  • A superior class of customer support is provided to solve the queries of clients arises related to the investment portfolio.

DHFL Pramerica PMS Customer support

Excellent customer support helps the clients of the company at each and every step to solve their problem. So, every client enquires for the customer support service of the company before going to take PMS service from them.
Here is the of the excellent support provided by DHFL Pramerica PMS to the clients:

At very first, Email and WhatsApp support are provided to the clients as a basic mean of communication with any organization. Except this, the company has also provided call facility to the relationship manager to minimize the queries of clients and to make the relationship between both parties strong.

Above all, the company has permitted its clients to directly call the fund manager from 3 to 7 times in a month, and the low amount investor can call up to 3 times in a month.

The Turnaround time (TAT) to resolve issues related to the portfolio investment is 10 working days.


DHFL Pramerica PMS Conclusion

DHFL Pramerica PMS is a brand name in the market, well-known for its unique PMS strategies and their performance. Its great investment philosophies have given better than expected return to the portfolio investors.

Apart from this, the company provided different ranges of investment plan according to the financial and risk-bearing capacity of the clients. It also offers flexible commission/fee models. An excellent customer support system is also available with the company.

So, we can see that the company has almost all the required facilities for the portfolio investor. Hence, if you are in search of a great PMS house, DHFL Pramerica PMS is one of the best options.

In case you are looking to use the most trustable portfolio management service with the highest returns, let us assist you in taking the next steps forward:

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DHFL Pramerica PMS FAQs

Here are some of the most frequently asked questions about DHFL Pramerica PMS:

Who can be an ideal investor for the ‘ Core equity portfolio strategy’?

Ideally, the following person can be an ideal investor:

  • Residents and non-residents of India.
  • Hindu undivided family
  • Pvt companies, public companies, partnership firms.
  • Other eligible investors.

What return is expected to the portfolio investor?

Since there are too many variables in the stock market which works. So, it is very difficult to say about any guaranteed return to the portfolio investors.

Is it possible to withdraw the partial amount from the PMS?

Yes, it is possible to withdraw the partial PMS amount with an applicable exit load charge. If the withdrawal is made before one year of portfolio creation exit load fee is applicable.

Can a portfolio investor directly talk to the portfolio manager?

Yes, an investor can directly call the portfolio manager but the number of calls is limited for the low worth investors and high worth investors.

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