Nilesh Shah, founder of Envision Capital, has identified two distinct growth stories in the Indian market: OnEMI Technology Solutions and Milky Mist Dairy Food. The fund is positioning itself around these names not just for their current valuations, but for their structural advantages in their respective sectors.
In the fintech space, Shah points to OnEMI, the operator of the Kissht loan platform. The company posted a 40-50% growth rate in its most recent quarter. While the assets under management (AUM) remain under $1 billion, Shah argues this is a "phenomenal" setup. The key variable isn't the growth rate, but the credit cost. If OnEMI keeps its bad loan ratio in check while scaling, the equity story gets stronger. He noted the leadership has managed credit quality well so far, but for a credit business, that metric is the only one that really matters long-term.
The dairy sector bet is different. Most players in the space struggle to get more than 10-30% of their sales from value-added products like cheese, ghee, or packaged milk. Milky Mist flips this. It generates 100% of its revenue from this segment. Shah called it "value-added native." With regulators pushing for higher quality standards and consumers moving away from unorganised milk, this company doesn't have to pivot; it's already there.
The broader thesis is simple. Africa and India are seeing a massive migration from informal to formal consumption. Shah expects this shift to accelerate over the next five to 10 years. For active traders, this means these aren't just cyclical plays. They are structural compounders. Watch the credit cost metrics for OnEMI and the market share expansion for Milky Mist. That's where the alpha is.