Chronicle of the investment journey of Amit Bivalkar of Sapient Wealth


Can you describe your current portfolio allocation?

I am currently at 40% equity, 60% debt. The biggest debt has more to do with certain debts that I have to pay. Otherwise, I’m a balanced type of investor with around 60-65% equity and 30-35% debt.

In equities, is the allocation rather large cap or mid and small cap? Do you have a ballpark percentage on that?

It is more of a flexible cap and there is some exposure to international funds. About 20% is in international funds and the rest in flexi cap.

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There is a gradual freezing of international funds. Do you think it will hurt the wallet?

We have seen that these types of restrictions persist for a while and then they open up. ETFs (Exchange Traded Funds) are always open. You can go the ETF route and invest globally.

What was your first investment?

I started my career at Sajag Securities in Pune, and it was an equity brokerage. So obviously stocks were my first investment. At the time, I was investing without any research or homework. I had beginner’s luck and made some money and then suffered huge losses. After that it only went through SIPs, and in the last four-five years I think I added PMS, consulting and private equity.

What is your oldest fund since you started investing?

I had been investing in DSP since I worked for DSP Mutual Fund. I’ve had an investment in DSP Opportunities Fund in my child’s name since 2004. Another long-standing fund is a Fidelity program – now L&T Flexi cap fund – which I bought in 2005. I generally don’t move to unless there is a tactical call or we see the markets move sideways for two or three years. My average detention should be about seven years.


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Did you make any changes when Covid-19 hit the markets?

I went to 90% equity and 10% debt. This 10% debt was there because I didn’t have the courage to put 100% in equity. Also, the period was such that everyone had said that the Nifty would return to 6,000 levels. So, I thought, let’s wait for the bottom and maybe I’ll add that 10% too then, but that never happened.

How many funds do you hold?

I have seven equity (and commodity) funds in my portfolio and three in debt. These seven funds have a combination of international and domestic equities and gold and silver as commodities. These are all active funds.

Do you have a rough figure of the internal rate of return (IRR) of your portfolio since its inception?

It would be close to 14%. It’s about 16 years.

Do you have life or health insurance?

Yes, I have life insurance and health insurance. I think you should have life coverage for 20 times your monthly income, and I’m close to that number. I also have medical coverage. I also have a supplemental policy that comes into effect when the medical expenses exceed what the base policy covers. It has a relatively low premium due to this conditionality. I also have an overseas travel accident insurance policy.

If you had to name one program that has generated the most wealth for you, what would it be?

It would be very difficult to answer this question, because in terms of the period, the investments did not arrive on a given date. But I think these are mostly flexible capitalization funds. Previously, large-cap or multi-cap funds did the trick. I’m not one to invest in small cap funds. I go through the flexi cap route.

What is your approach to real estate investing?

The house where I live and the office where I work are my real estate investment. I say if you want to enjoy your life, you go from a 2BHK apartment to a 3BHK then to a 4BHK because this apartment is yours; you take advantage of the property. What’s the fun of buying a property where you’re not going to stay or renting it out? The rental yield is 1-2%, while your mortgage is at 7%.

Describe the circumstances surrounding the start of your Sapient journey.

In 2008, I was at AIG. He went bankrupt in the United States. After that, we had just launched our infrastructure fund because infrastructure was the theme then. After the crash of 2008 in September and October 2008, many investors were calling our office landlines directly. And that made me think about why these people weren’t calling their advisor or their banker. Clients were telling us that advisors and bankers were not answering their calls. It was then that I realized that many clients were orphans. So that was the period when we thought about launching Sapient. In June 2009, we launched it.

So what was the AUM in first or second year, and how has it evolved since then?

The first year lasted about 70-80 crores. Half of the portfolio belonged to my partner Janak Shah who merged his company with mine.

In 2009, fixed maturity plans (FMP) yielded 8.5 to 9.5%. Pune is a retirement city. You have many banks, many cooperative banks. People are interested in fixed income instruments. So, we took the FMP route, and it was easy.

So everyone thinks of building AUMs through equity, but we built our AUMs through debt which grew us for the first few years, and then when the FMP money started coming in, the appreciation went into equity, and we built the SIP book and that’s how we started. Thus, the first year, it was about 80 crores. Next year we went to 240 crores. Then we had a really big hit when companies in Pune started allocating their money to mutual funds so we went to about 350 crores the following year.

Today we are at 12,000 crores. This has been the course for the past 13-14 years.

Much of your growth also comes from mergers. Please tell us more about it.

It is with like-minded people in other geographies. We were lucky to have Pallav Bagaria in the northeast as well as Paresh Karia in Mumbai. Two years ago, Rupa Venkat and Dhruv Mehta also merged their practice with Sapient. It is very difficult to leave your own brand and merge with another entity.

When you look at the organizational structure, you think of it as an accounting firm rather than a business. Older partners can retire and new partners can onboard.

We came together because as an individual IFA we don’t have a reporting officer so we are bound to make mistakes as everything I think is correct gets translated into portfolios. So if you have a board, you report to someone. I think this collaboration bought various assets and talents in the industry like DhruvMehta who was the CFO of a very large listed company, and was doing very well in lubricants. So we bring that expertise. Pallav has been doing business for so many years. Paresh is a Chartered Accountant.

I think all of this leads to better organization. So everyone brings their own skills, then you are responsible and accountable.

Are there any lifestyle changes you’ve made post-pandemic that you think will continue?

I loved my whiskey, stopped it completely after the pandemic. I am a keyboard player and I continue to play the piano. I am also a big collector. There are about 1,200 records in my house. I walk at least 3 to 4 km a day.

Do you involve your wife in your family finances?

Yes of course! In a household, your spouse needs to know where you are investing. I have a one-page net worth statement at home and I update it monthly.

It is very important that your family members are involved in your finances. You may not disclose executive investment decisions, but you definitely need to impart information and knowledge to them so they can manage their finances well.

Since my wife is a doctor, she also has her own opinions. So, her wallet works according to what she feels; advice may come from me, but she makes her own financial decisions.

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