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Quarter	Letter Date	Fund Name	QTD	YTD	Tickers	Themes	Quick Take

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Apis Deep Value Fund 2024 Q1 Investor Letter | Buyside Digest

Back to Fund Profile (Apis Deep Value Fund)

Primary Source Intelligence • Q1 2024 Letter Analysis

Apis Deep Value Fund Quarterly Analysis

Buyside Digest is not affiliated with, and does not endorse, Apis Deep Value Fund. This analysis is provided for institutional research purposes only and is not investment advice.

Fund Returns

Digest Analysis

Quick Take

"Europe, and North America. Strong performance driven by defense spending acceleration, electrical grid upgrades for AI data centers, and copper recovery."

Executive Summary

Apis Deep Value Fund delivered strong Q1 2024 performance with 10.1% net returns, driven by exceptional stock-picking across long and short positions. The fund maintains 60% net long exposure with concentrated positioning in Asian markets and small-cap companies under $1bn market cap. Key themes driving performance include global defense spending increases, electrical grid infrastructure upgrades for AI data centers, and copper price recovery. Top contributors included HD Hyundai Electric, benefiting from grid modernization trends, and defense-related holdings capitalizing on European rearmament. The portfolio's smallest companies showed marked improvement after last year's losses, suggesting broader market participation. Geographic exposure remains tilted toward Asia with balanced North American and European allocations. Sector concentration in Industrials and Technology reflects the manager's conviction in infrastructure and defense themes. Natural Resource Partners emerged as a standout performer, trading at attractive 4x free cash flow despite strong fundamentals. The manager expects continued benefit from market broadening trends and anticipates significant value realization as defense spending accelerates globally and grid infrastructure investments materialize.

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Institutional Meta Strategy

Meta Strategy Gauges

Algorithmic conviction, macroeconomic posture, and risk appetite signals extracted from this quarterly letter with qualitative explanations.

Signal Matrix

Market Conviction

72%

CautiousHigh

High Conviction (72%)

The manager demonstrates high conviction through concentrated positioning in specific themes (defense, grid infrastructure) with detailed analysis of individual holdings like Poongsan and NRP. Named positions are sized and explained with clear catalysts, though the diversified geographic and sector approach prevents maximum conviction scoring.

Growth Outlook

25%

BearishBullish

Bearish (25%)

The manager expresses cautious optimism about market broadening trends and specific sector opportunities, particularly in defense and infrastructure. However, they acknowledge challenges in areas like EV penetration and solar pricing pressures, resulting in a mildly positive but measured outlook.

Risk Appetite

40%

DefensiveAggressive

Defensive (40%)

The fund maintains 60% net long exposure with 98% long and 38% short positions, indicating a risk-on tilt. The manager is selectively adding positions in consumer areas and maintains concentrated exposure to small-cap names, showing moderate risk appetite.

Capital Deployment

15%

De-riskingDeploying

De-risking (15%)

The manager reports no dramatic changes to positioning with some increase in consumer exposure through new longs and shorts. Geographic and sector allocations remain similar to year-end, indicating modest net deployment activity rather than significant capital movement.

Forward Guidance

30%

CautiousExpansionary

Cautious (30%)

The manager indicates selective deployment with some new consumer longs and shorts they are excited about. They express confidence in benefiting from market broadening trends but maintain a measured approach to new positioning.

Language Signal

20%

BearishBullish

Bearish (20%)

Language is balanced with opportunities highlighted in defense, grid infrastructure, and specific holdings, but tempered by acknowledgment of risks in EV and solar sectors. Overall tone is constructive but not overwhelmingly bullish.

Perceived Risk

45%

Low RiskElevated

Moderate Risk (45%)

The manager acknowledges specific sector risks including slowing EV penetration and solar pricing pressures. However, risk discussion is limited to these specific areas rather than broader systemic concerns, indicating moderate risk perception focused on sector-specific challenges.

Opportunity Density

65%

ScarceAbundant

Abundant (65%)

The manager identifies attractive opportunities in defense spending, grid infrastructure, and specific undervalued names like NRP. They express excitement about new consumer positions and see potential in market broadening trends, suggesting a moderately rich opportunity set in targeted areas.

Time Horizon

70%

Short-TermLong-Term

Decade+ (70%)

The manager discusses multi-year themes like defense spending increases and grid infrastructure buildout, with specific catalysts like NRP debt paydown by 2025. The focus on structural trends and willingness to hold through volatility indicates a medium to long-term investment horizon of 2-5 years.