Endurance Capital is a long term and active investor into a concentrated portfolio of listed Vietnamese companies
Misunderstood & undervalued companies
Endurance Capital focuses on identifying overlooked, misunderstood and undervalued companies across Vietnam’s three stock exchanges. Often Endurance Capital invests into listed companies that are out of favor, or not yet discovered, by the broader public market investor community.
First-hand bottom-up analysis
Endurance Capital identifies its opportunities outside of the typical coverage of institutional equity research and conducts first-hand bottom-up fundamental analysis of potential target companies, among others through its vast network of local financial and domain expert operational advisers. From start to finish, the due diligence process typically takes 6-12 months, during which Endurance Capital aims to interview a long range of relevant stakeholders around the company (e.g. customers, competitors, ex-management, other shareholders, etc.).
Active ownership
In the situations where Endurance Capital deems it necessary to realize the full value potential of one or more of its holdings, it will selectively act as an active owner to empower the company to outperform, primarily through direct or indirect representation on the board, or alternatively in a direct dialogue with management.
Concentrated portfolio
Endurance Capital holds a concentrated portfolio of around 10-15 holdings, at any one point in time. This concentrated portfolio allows Endurance Capital to understand its holdings better than the rest of the market. In this context, the increased concentration becomes a more potent risk mitigator than diversification.
Long-term holder
Endurance Capital is a long term holder, with a typical holding horizon of around 5 years, or longer if an individual case motivates it. This allows the Endurance Capital strategy to profit from the significant short term mis-valuations that occur on the Vietnamese stock exchanges where retail investors are still the dominant investor group (ca. 80%).
Deep value approach
With its disciplined “deep value” investment approach, Endurance Capital seeks to invest in companies that are significantly undervalued relative to their intrinsic cash/ cashflow value. Within this investment approach, Endurance Capital also practices a “margin of safety” principle where only deeply undervalued targets are considered (targeting companies that can at least triple in value over 3-5 years).
Minimum risk-weighted return requirements
Over time, Endurance Capital expects to actively engage in ca. 30% of its holdings. All of the active investments are however required to meet the minimum risk and return requirements already without the upside that can be unlocked through active ownership.