MarketStar Capital
Investors

Hello and welcome. This page shares information to help you understand the benefits a MarketStar shareholder, the shareholding process, and next steps in case you are interested. We started with equity trading and investing in 2009 to help trusted individuals in our network, and now this our investment opportunity is available to anyone who would like to be our shareholder, subject to the shareholder agreement. In 2010 and beyond, we will trade in the capital market, both short term and long term. Our approach remains the same, our scale become bigger.

  1. Investment Experience: MarketStar is an investment services company investing in Indian businesses and assets, and share the benefits of these investments with our shareholders.. We track over 50 high-growth companies based in India, and we have varying levels of investments in them. We offer a strong India investment opportunity for investors to benefit from the strong economic growth of India, through our ground-level presence in India, and the ability to track key industries/companies and execute trading opportunities as they arise.  Each of the companies is listed on the NSE/BSE. Some of these companies derive nearly 100% of their revenues from  domestic markets, and some of them are exporters with customers worldwide.  MarketStar is meant to be a liquid investment which is managed by people who understand the businesses. We believe that with a disciplined approach, a conservative and disciplined approach we can achieve a good returns from investments.

  1. Growth Opportunity: The Indian economy is projected to grow between 8 to 10% over the next 5 years means that there is a tremendous growth opportunity just by virtue of the consumption and Industrial growth happening within the Indian economy (Industrial Product was up 16% based on Feb 2010 data). And some of the export-oriented industries will also scale up further as the global economy recovers.  This means that we have the ability to generate returns without taking undue risks.

  1. Quality Investments: As a guideline, 80% of our capital will be deployed in liquid public-listed companies, among the top 500 companies in India (called S&P CNX 500). And within these top 500 companies, a majority of our investments will be in the top 100 companies (called CNX 100), which are poised for high growth along with profitability. Overall there are many solid multi-year growth opportunities.

  2. Liquid Investment: One of the fundamental goals of MarketStar is to offer a liquid investment for our shareholders, with controlled share prices that reflect our business growth. While our stocks are not listed on any stock exchange, we do want to maintain a liquid investment for you as a shareholder, so when you want to exit your investment and sell your shares we will buy them back from you at the ongoing share price. Liquidity of capital is important for us, so short trading cycles of 3 to 6 months will be used.  As mentioned earlier, as a broad guideline, 80% of our capital will be deployed in opportunities within top 500 public listed companies in India, and the remaining 20% will be used for trading purposes on the commodity side, like agricultural commodity trading. or maybe a working capital loan given to another business, all of which will have trading cycles less than six months.

  1. Understanding of Invested Business: We have the abilities to understand both the small scale, mid size and large businesses.  We are already in touch with dozens of companies and their executives.  We have been following their businesses and understanding how they plan to grow and what kind of growth plan and challenges they face which gives us a better idea on which kind of investments we should be making and the aim is always to make a safe investment.  We do not want to take very high risks in our investment because we want to offer a safe and credible growth which is very much possible without taking any undue risks. 

  2. Active Investors: We actively track and engage with the management/ Investor Relations Team of every company that we invest in. We strongly believe that without confidence in the management of a company, it becomes very difficult to support their stock with our capital in situations when their stock prices are falling significantly. When there is confidence in the business and its management/promoters, falling stock prices in market corrections are great opportunities to accumulate more stock. However it is very important to buy at correct prices: Well bought is half sold. This is where our trading experience helps us.

  1. Conservative Approach:  We don't chase prices and experience has taught that nothing ever keeps going up. Gravity exists in the capital markets too. Patience itself can increase portfolio returns by a big margin over any 5 year period. So we are comfortable holding high levels of cash, even our entire portfolio in cash if required. This is very much unlike mutual funds, which constantly maintain 80-90% of their portfolio in stock and that can be very detrimental to the NAV (Net Asset Value) of the mutual fund unit, in case of market downturn. We don't trade in derivatives, however we may use Put Options to protect our portfolio in bearish market conditions.

  1. Our Share Price:  We will publish one share price per month - on the 1st of every month - and that share price will apply for the whole month. This is to ensure that as a shareholder you are not subject to the wide fluctuations of the stock market that happen often. For example, if you have mutual fund units, you would observe that the stock market situations reflect completely in your unit value. Often the market goes down for a week or two and bounces back right after that, making any sale of stocks in between a wasted effort. Based on feedback from many current and potential shareholders, it will make investment decisions easier  with a fixed share price of share per month, and a significant portion of our net profit from business will be shared with shareholders through dividends.

  1. Dividend: We plan to share and dividend twice in a year, subject to business performance. The dividend decision will ultimately be decided by the amount of profit we generate, which will depend on the business and the economic conditions. The plan is to use dividends as a means to share the gains we make in our business. The exact amount of dividend per share will be decided by the company's directors.

  1. Exit Option: To ensure liquid investment, we plan to offer exit option to our shareholders after six (6) months of investment. So for the first six months of your investment you cannot sell your shareholding because we believe that any serious investment needs at least that much time to deliver meaningful results.  The investment lock-in for first six months of an investment is a necessary condition to being a shareholder in MarketStar. After this period, a shareholder can sell the shares any time at the ongoing price for the share in that particular month, and we will facilitate the sale to other other shareholders who have expressed interest to buy larger amounts of our shares.

  1. Performance Benchmark: We will be comparing our performance with the S&P Nifty, which is the top 50-company Indian stock index and market benchmark.  As you may know most mutual funds and companies do benchmark their financial performance with the Nifty in India or in whichever country the benchmark index is used; it is a commonly accepted standard. We would be comparing our performance with the Nifty on annual basis, our stock price plus the dividend will be used for that purpose to show the kind of return that shareholders have got with us versus with the benchmark index. 

  1. Flexible Investment:  Our shareholders can invest capital at small levels based on their needs, and therefore it is flexible. If you are investing in equities through Mutual Funds, you will find a better long term investor in MarketStar. You can invest a bit of your equity portfolio with us and over a period of time once you see the results. 

To summarize, the Indian economy is projected to grow at 8-10% over the next 5 years and if you do not have India investment portfolio today, then you must initiate it one way or the other. MarketStar can help you gain from this growth opportunity ahead of us.

Following are the documents related to the company and becoming our shareholder:

If you are interested to be our shareholder, please contact us for next steps.
Thanks very much for your time and interest in MarketStar.

Sincerely,
Sandeep Saxena and Shankar AVSB
On behalf of MarketStar, a group company of 7Avenues Enterprises



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Asian Investments & Indian Financial Services