Manas Fund To Focus On Asia Ex-Japan Companies

Mar 19 2012 | 11:21am ET

Anuj Sehgal, a former JPMorgan vice president, has launched his first hedge fund—an Asia ex-Japan vehicle with a Sanskrit name.

The Manas Asian Equities Value Fund launched on March 1 (Manas means ‘mind’ in Sanskrit). The fund will invest across asset classes, with the exception of commodities. The focus will be supply chain, component, product and service companies in the region—particularly Hong Kong, India, Singapore and Taiwan. Manas Capital is the investment manager of the fund and Geomatrix (HK) is the investment advisor.

The fund will eschew leverage and employ derivatives “sparingly.” Sehgal says the approach is “to find good businesses run by good managements which are undervalued and buy them on the long side. On the short side the approach is exactly opposite. I don’t believe in doing pair trades. So hedging will be largely restricted at the portfolio level and that too very minimal. As a rule I am also averse to leverage as it cuts both ways.”

Sehgal has seeded the fund with his own capital and that of friends and family. The minimum investment for the fund is US$100,000 and the fund’s capacity is US$300 million.

The fund aims to have a concentrated portfolio of 30 long positions and 5-10 short positions.

The Hong Kong-based Sehgal has over 10 years of investing experience in Asia‐ex Japan, most recently, as a director at Anand Rathi, an Indian financial services firm. Prior to that he was a risk analyst for Nomura International and before that a risk analyst for the $300 million equity long/short hedge fund North of South Capital. Sehgal spent five years at JPMorgan in Hong Kong and Singapore in investment banking and equity research.

Asian funds had a rough time of it in 2011. Eurekahedge reported the average Asia ex-Japan fund lost 12.7% in 2011. By contrast, global hedge funds lost only 4.15%, their second-worst year ever. Sehgal, however, is not discouraged:

“The approach is a very stock-specific, value approach with a concentrated portfolio. I don’t know what will happen in 2012, but in Asia there are great businesses that are run by great people. One has to be on the look out to invest in them when they are available at cheap valuations because of events around the world.”

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