Health, Wealth & Leadership [21 Apr 2024]
Plant based diet for metabolic syndrome, Marcellus vs the Index, and 0 to 17 Million
Every Sunday I share three lessons on how to be healthier, make more money and lead by example. This week we talk about whether a plant based diet reduces the risk of metabolic syndrome, why Marcellus has not beaten the index, and the value you need to provide to grow a following from 0 to 17 million.
You can access previous editions of my weekly emails here.
(1) Does a healthy plant based diet reduce risk of metabolic syndrome?
This study of 34,953 participants with average ages between 41–67 states that a higher adherence to a healthy plan-based diet does reduce the risk of metabolic syndrome. Whereas an unhealthy plant-based diet was associated with a higher risk of metabolic syndrome.
What is metabolic syndrome? If you have at least three of these conditions then you have metabolic syndrome:
- abdominal obesity
- high blood pressure
- high fasting blood sugar
- high blood triglycerides
- low HDL-Cholesterol
Eating a healthy plant-based diet reduces the risk of getting these conditions.
Here is the study: https://pubmed.ncbi.nlm.nih.gov/38260063/
(2) The benchmark has beaten Marcellus Portfolios. Why?
The benchmark has beaten Marcellus Portfolios, except MeritorQ which has almost met benchmark returns of almost 40%.
Why has Marcellus not done better?
Let's look at each portfolio one by one:
Consistent Compounders (CCP): The portfolio has a lack of exposure to certain segments of the stock market which, due to low cash generation and ROCEs in the long term, do not form part of the coverage universe for CCP. We see this outcome reversing in future. Nifty50 TRI delivered 30% returns in FY24, which is significantly higher than the long term sustainable expected annualized return from the benchmark. Long term fundamentals of CCP Portfolio companies significantly outperform the index:
- ROCE (pre-tax): 30% for CCP vs 15% for Nifty50
- ROE (post-tax): 26% for CCP vs 17% for Nifty50
- 5-year PAT CAGR: 19% for CCP vs 10% for Nifty50
Kings of Capital (KCP): The top contributors to performance during FY24 were ICICI Lombard, Info Edge, Prudent and Chola while the detractors were HDFC Bank, Aavas and Kotak Bank. Given the strong rally in PSU banks, the valuation premium of KCP lenders is at an all time low despite the superior RoAs of KCP companies. We believe that this superiority in business model and return profile of KCP companies deserve a higher premium than what is currently reflected in the stock prices and therefore re-rating along with healthy earnings growth will be drivers of KCP performance.
Little Champs (LCP) and Rising Giants (RGP): The exports data for the month of March 2024 further strengthened our belief regarding the recovery in Little Champs and Rising Giants portfolio companies especially those in the exports and chemicals space. We continue to reetirate that as we head into FY25, the portfolio earnings should recover. Any positive development (cut) on interest rates can be an icing on the cake in terms of significant improving the consumer sentiments for the stocks with global market exposure. However, a risk factor is any major escalation in the geopolitical issues such as the current tensions in the Middle East region.
Prices usually follow earnings. And earnings of Marcellus companies are in some cases 2x that of the benchmarks. The goal is not to make the most returns every year. The point is to make good returns over many years.
In the short run, the market is a voting machine but in the long run, it is a weighing machine. Think long term. Think like an owner when you invest in businesses.
Dive deeper into Marcellus performance as of 31 Mar 2024: https://marcellus.in/newsletter/marcellus-erudite/marcellus-portfolio-performance-and-update-on-fundamentals/
Disclosure: I am an independent financial advisor for Marcellus Investment Managers.
(3) 0 to 17 Million
To grow to such a following you must provide value.
Here are 5 things I learnt from Dhruv on how he grew his YouTube channel:
Be Unique - Run a race where you're the only one running. Your interests and your skills are already a unique combo. Take that as a way to explore what you should focus on.
Be Valuable - the demand comes when the audience finds your videos valuable. Comedians provide entertainment. Dhruv Rathi provides knowledge. You have to look at your own passions, skills and needs to determine what value you can provide.
Be Authentic - be as you are. Don't try to pretend.
Quality > Quantity - viewer can tell within the first few seconds whether the quality of your videos are interesting for them to keep watching or not. If quantity becomes the focal point then quality will suffer.
Be self critical - to continuously improve, you have to be self critical.
Link → video
Other posts on LinkedIn and WhatsApp:
Health: The Effects of a Healthy Diet on Asthma and Wheezing in Children and Adolescents
Wealth: The RBI published a report in 2017 called "Indian Household Finance".
Leadership: Embrace the criticism
Harsh Batra (LinkedIn)
Whenever you are ready, there are 3 ways I can help you:
EthosData - If you are running M&A transactions, planning an IPO, or sharing anything confidential online, my team can run your Virtual Data Rooms. Companies like Tata, Reliance and Moody’s trust us.
Happy Ratio - If you want to eat a healthy diet then eat at our Health Stations across Delhi and Gurgaon. If you don’t live in Delhi, you can order our all-in-one health shake on our website or Amazon. It took us twelve iterations over the past decade to create our health shakes. They have all 39 nutrients, every macronutrient, every vitamin and mineral and come in chocolate, vanilla and coffee flavor.
Marcellus Investment Managers - If you want to turn your savings into future income, and have a long time horizon (5-20 years) then consider investing with Marcellus. The Marcellus team of 25 researchers only invests in businesses with a stellar track record, competitive advantages and immense future earnings potential, targeting 18%+ annual returns per year across their 6 portfolios i.e. 5x your money in 10 years. I have invested in Marcellus portfolios. I am also an Independent Financial Advisor with Marcellus.