Drona Capital is a long-only Equity Fund that invest in listed securities in US financial markets.

The fund was launched as a Managed Account in 2009 and got formally Incorporated as a Fund in 2012.

Investment Philosophy

We value our investors’ needs of wealth preservation and therefore our objective is to ‘provide sustainable and adequate return on investment at minimal risk’.

Investment Strategy

We seek to identify exceptional businesses that are undervalued and invest in them long-term.

Key Elements of Investing

Invest in high quality business

• Well run companies with experienced management team and long track record of market leading financial metrics of sales and earning growth as well as superior capital allocation strategy.

• Wide Moat with proven ability to sustain the competitive advantage – most of our portfolio companies have #1 position in the industry they operate in

Key Elements of Investing

Invest in high quality business

• Well run companies with experienced management team and long track record of market leading financial metrics of sales and earning growth as well as superior capital allocation strategy.

• Wide Moat with proven ability to sustain the competitive advantage – most of our portfolio companies have #1 position in the industry they operate in

Strict Avoidance of Risk

We stay away from fast changing industries or companies exposed to government regulations or those pursuing aggressive M&A.

We do not invest in companies that are highly leveraged. Nearly 50% of our portfolio companies are net cash with no debt on their balance sheet.

Invest ONLY when the price is right

We take advantage of market inefficiencies when the market at times over reacts to a ‘bad news’. Covid or financial crisis were two such times when there was a once in a lifetime opportunity to invest in some exceptional businesses.
If a company has a bad quarter and misses its guidance, market sometimes becomes too pessimistic. This might lead to a low valuation for an otherwise excellent business, and we do not hesitate to use these opportunities to invest in the businesses.

Invest long-term

Ideal investment perios is FOREVER
Median holding period for the top 10 portfolio companies is 7 years and the oldest is 13 years

Excerpts from our Annual Newsletter

 

For the first time, we had a portfolio company exceed ten times return this year- Mettler Toledo’s returns reached 1004% – a definite proof of the compounding effect of a great business, if held long enough. It is also a clear indication of our “selling strategy”- which is never to sell a stock just because it has doubled or tripled or even grown ten times. We will sell a stock such as Mettler Toledo ONLY when we believe the strength of its operating model, or its financial metrics has deteriorated considerably and therefore is not attractive as a long-term hold for Drona”