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Value Migration
Wednesday, April 26th, 2017

Disruption is the buzzword in the new economy. Major shi s in the economic landscape and the
advent of new technologies are enabling start-ups to challenge established models of doing
business. These new emerging businesses make disproportionate returns and capture a signi cant
part of the new value they create. Value migration is a term aimed to capture this e ect.

Value Migration is the  ow of economic and shareholder value away from obsolete business
models to new, more e ective designs that are better able to satisfy customers’ most important
priorities. Motilal Oswal has come out with a great thematic report on value migration
(http://www.motilaloswalgroup.com/AnalystVideo/Pdf/906027005VALUE%20MIGRATION-
MOSL-20170106-SU-PG0100.pdf) which outlines a few case studies in the Indian investment
landscape that have bene ted from this trend. We have outlined some of their ndings below.

As mentioned in the report, value migration can happen in several ways as outlined in the chart
below:

Value migration can be driven by advantages led by  technology,  cost,  convenience, innovation,
access to funding, or lower switching costs. Here is a snapshot of some of the case studies that the
report outlines and the drivers behind the shi :

 
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This can even happen with unlisted players:

Finally the report uses value migration as a tool to identify solid and compounding franchises
that would bene t from these trends and would have the potential to generate outsized returns
for their investors over the long term.

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Motilal Oswal’s research goes into great detail for each and every one of the themes outlined
above. We do encourage you to read the entire report
(http://www.motilaloswalgroup.com/AnalystVideo/Pdf/906027005VALUE%20MIGRATION-
MOSL-20170106-SU-PG0100.pdf) as it gives a great insight into the massive shi s happening in
our economy. If nothing else, it will give you a framework on how to think about investing in
disruptive businesses’.

Kindly note that this is not an endorsement by us on stocks or themes mentioned in the report.
All the information is for educational and informational purposes only. Please consult a quali ed
nancial advisor prior to making any investment decisions.

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About the author

(https://kairoscapital.co.in/author/rmanekia/)

Rishad is the founder of Kairos Capital. He started his career with Standard Chartered Wealth
Management and has extensive experience in markets, particularly in terms of mutual funds and
stocks.

View all author posts → (https://kairoscapital.co.in/author/rmanekia/)

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