In January, we interviewed 112 companies from 28 countries which we hadn’t met earlier during our 11 Sectors in 11 Months project as most had IPOed after our deep dives into their respective industries.

We found two recent Turkish IPOs which we believe can double in the next 12 months. One is a fast-growing $150m software solutions business which is currently ramping up with master franchisees of Burger King and other QSRs and is only trading at 9x LTM P/E. The second is a $65m investment banking boutique trading at 11x LTM P/E, which expects earnings to double in 2021 on the back of improving M&A activity as well as growing brokerage, wealth management, and NPL businesses. Both are led by highly experienced US-educated CEOs (with degrees from MIT, Harvard, Georgia Tech, and Rice) who own significant stakes in their companies and thus are incentivized to grow the pie.

These two IPOs went unnoticed as investors in Turkey have been focused on a yet-another currency crisis. In 2021, after a long search for the right solution, we were able to start hedging our Turkish lira exposure, saving us nearly 3% performance during the first two months when the lira fell over 40% against the US dollar. We’re happy to be protected from future currency turbulence in Turkey as it is home to so many of the overlooked, small, liquid, cheap, growing, high-quality companies we love to own.


In February, we increased our position in a $40m hospital operator in Turkey, becoming a substantial shareholder through our ownership of nearly 10% of the company. The business continued its impressive growth with historic-high earnings in Q4 and shows no signs of slowing as it made another acquisition, further extending its bed capacity. We also bought shares in a $900m Indonesian lifestyle retailer that is swiftly recovering from the pandemic as consumers return to the stores which are now more efficient than ever thanks to operational improvements and cost-cutting measures triggered by Covid. We’ve been following this company for two years and believe the time to invest has finally come.

This month, the world witnessed an attack on Ukraine ordered by the Kremlin. In over 8 years since our fund was launched, we have never invested in any Russian company. As soon as the war started, we emailed all our portfolio companies and asked each one about their Russia-related revenues. The survey revealed that the vast majority of our companies have no exposure to Russia, and the fund’s overall portfolio-level revenue exposure to Russia is at an insignificant 0.148%. We are currently working on repositioning our portfolio to address the ongoing crisis. 


In March, we took actions to safeguard our portfolio against the supply shocks and inflationary effects of the war in Ukraine.

We sold all our portfolio companies in Egypt. Before the war, 86% of the country’s wheat imports used to come from Russia and Ukraine, and now the economy stands to see dramatic increases in inflation as it tries to replace this and other imports amid the global shortage of commodities. Our decision was timely: a week after we cut our exposure the Egyptian central bank devalued the local currency by 14% to address the rising costs of basic goods and foods. Limiting the inflationary pressure on our portfolio from the global food industry, we also exited our positions in a dairy company in Malaysia, a packaged foods business in the Philippines, and a shrimp producer in Thailand. We also sold an airline and a truck operator in Mexico due to their high cost exposure to oil.

We bought several companies which should do well in the current environment as they either grab market share from Russian firms now shunned by former buyers, or as the prices for their products stay at exceptionally high levels due to global shortages amid high demand. These include: a nickel producer in Indonesia; an integrated petrochemicals business in Saudi Arabia; fertilizer manufacturers in Vietnam and Pakistan; and a producer of platinum, palladium and gold in South Africa.