Sundaram Rising Stars Review: Inside Sundaram Alternates' Longest-Running PMS
Last updated: 12 October 2026
Quick answer: Sundaram Rising Stars Portfolio is a small and microcap equity PMS run by Sundaram Alternates since November 2009, its oldest strategy. As of 31 August 2026 it returned 52.5% over one year and 15.6% a year since inception against 12.1% for the S&P BSE 500 TRI, but trailed the Nifty Smallcap 250 at 4, 7 and 10 years.
Last updated: 12 October 2026 Quick answer: Sundaram Rising Stars Portfolio is a small and microcap equity PMS run by Sundaram Alternates since November 2009, its oldest strategy. As of 31 August 2026 it returned 52.5% over one year and 15.6% a year since inception against 12.1% for the S&P BSE 500 TRI, but trailed the Nifty Smallcap 250 at 4, 7 and 10 years. Key takeaways Purest small-cap play: 88% small cap, 10% mid cap and 0% large cap in July 2026, around 25 stocks. Returns to 31 August 2026: 52.5% (1 year), 17.7% (3 years), 16.4% (5 years) and 13.2% (10 years) a year. Mixed against its peer index: ahead of the Nifty Smallcap 250 at 1-3 and 5 years, behind at 4, 7 and 10 years. Sector tilt: Financial Services 28.9%, Capital Goods 23.6% and Healthcare 21.1%. Horizon: Sundaram Alternates recommends 5+ years, its longest across the four strategies; the minimum investment is ₹50 lakh. Updated for performance as of 31 August 2026 Launched in November 2009, the Sundaram Rising Stars Portfolio is the oldest of Sundaram Alternates' four PMS strategies — a few months ahead of SISOP (Feb 2010) and well ahead of S.E.L.F. (Jun 2010) and Voyager (Nov 2016). It is also, by design, the purest small-cap play of the four: as of July 2026 its portfolio carried zero large-cap allocation. In this review we look at what Rising Stars actually invests in, how it has performed against both its benchmarks through 31 August 2026 — including where it hasn't won, which is worth knowing before you invest — and who it suits. This is an independent review prepared by Money n Wealth — our PMS distribution desk (/products/pms) works with investors evaluating exactly this kind of strategy — drawing on Sundaram Alternates' own strategy presentation (July 2026) and on performance data current to 31 August 2026. It is not investment advice — see the disclaimer at the end. Sundaram Rising Stars: Rising Stars at a glance Full name Sundaram Rising Stars Portfolio Fund house Sundaram Alternates (Sundaram Alternate Assets Limited), Sundaram Finance Group Category Small & microcap equity PMS Inception November 2009 (16+ years — the oldest of Sundaram Alternates' four PMS strategies) Primary benchmark S&P BSE 500 TRI Secondary benchmark Nifty Smallcap 250 Investment universe Small-cap-focused listed Indian equities, generally below Sundaram Alternates' internal market-cap ceiling of roughly ₹80,000 crore, held in a multi-sector portfolio of around 25 stocks Portfolio manager Karthik Athreya (Managing Director), Darshan Engineer (Fund Manager) Minimum investment ₹50 lakh (SEBI-mandated minimum for all PMS in India); Sundaram Alternates states a recommended investment horizon of 5+ years for this strategy Independent rating CRISIL-powered 3-star, Small and Midcap Funds category (FY21-22 ratings cycle) Rising Stars performance: returns as of 31 August 2026 Here is how Rising Stars has performed against its primary benchmark across time frames, as of 31 August 2026. Returns under one year are absolute; one year and above are annualised (CAGR). Period Rising Stars S&P BSE 500 TRI Excess return 1 Month 7.0% -0.1% +7.1% 3 Months 10.5% 3.9% +6.6% 6 Months 31.1% 1.4% +29.7% 1 Year 52.5% 4.7% +47.7% 2 Years 22.4% -0.1% +22.5% 3 Years 17.7% 12.1% +5.7% 4 Years 16.4% 11.9% +4.5% 5 Years 16.4% 10.9% +5.5% 7 Years 20.0% 15.8% +4.2% 10 Years 13.2% 13.3% -0.1% Since Inception (Nov 2009) 15.6% 12.1% +3.4% Its 1-year return of 52.5% is the highest of any Sundaram Alternates PMS strategy as of this snapshot — but it's worth reading the whole row, not just the headline number. At the 10-year mark, Rising Stars has essentially matched its primary benchmark (13.2% versus 13.3%, a hair behind), and despite having the longest track record of the four strategies, its since-inception CAGR of 15.6% is actually the most modest of the four (SISOP: 19.0%, S.E.L.F.: 18.5%, Voyager: 16.0%). None of that makes Rising Stars a weak strategy — a long-run, benchmark-beating CAGR through multiple small-cap cycles including 2013, 2018 and 2020 is a real achievement — but the shape of the outperformance (concentrated in the last 1-2 years) is worth understanding rather than assuming from the standout recent numbers alone. Versus the secondary benchmark (Nifty Smallcap 250) — arguably the more relevant yardstick for a pure small-cap strategy: Period Rising Stars Nifty Smallcap 250 Excess return 1 Month 7.0% 2.5% +4.5% 3 Months 10.5% 8.1% +2.4% 6 Months 31.1% 15.7% +15.4% 1 Year 52.5% 11.3% +41.2% 2 Years 22.4% 0.6% +21.8% 3 Years 17.7% 15.5% +2.3% 4 Years 16.4% 18.6% -2.2% 5 Years 16.4% 15.7% +0.7% 7 Years 20.0% 22.3% -2.3% 10 Years 13.2% 14.1% -0.9% Since-inception comparison versus Nifty Smallcap 250 isn't shown in Sundaram Alternates' disclosure — the index doesn't have a like-for-like history stretching back to Rising Stars' November 2009 launch. We're flagging this table in full, including the periods where Rising Stars trails, because it's genuinely informative: against the broad-market S&P BSE 500 TRI, Rising Stars wins comfortably almost everywhere. But against its own small-cap peer index, it has actually underperformed at the 4-year, 7-year and 10-year marks, even while winning at 1-3 years and 5 years. That's a meaningfully different picture from the "outperforms everywhere" story the primary-benchmark table alone would suggest, and it's the kind of nuance that matters when you're specifically choosing a small-cap PMS to complement (or replace) small-cap mutual fund exposure. For context on long-run compounding: Sundaram Alternates' own July 2026 presentation shows that ₹1 crore invested in Rising Stars at inception (2009) had grown to approximately ₹10.57 crore by 31 July 2026 — over 10 times the original capital, against roughly ₹6.85 crore for the benchmark over the same ~16-year period. That figure is a July 2026 snapshot cited purely to illustrate long-term compounding; it is not the article's primary performance figure, which is the 31 August 2026 tables above. Past performance is not indicative of future returns. PMS performance shown here is at aggregate/model portfolio level, computed on a time-weighted rate of return basis, and individual client portfolios can and do vary. Bar chart of Sundaram Rising Stars PMS returns versus the Nifty Smallcap 250 over 1, 3, 5 and 10 years as of 31 August 2026, showing it trailed at ten years Rising Stars vs its small-cap benchmark (as of 31 August 2026) What Rising Stars actually invests in Rising Stars runs a multi-sector portfolio of around 25 stocks , and unlike its three sister strategies, it carries no structural large-cap allocation at all. Portfolio composition (as of 31 July 2026, model client level): By market capitalisation: Large cap: 0% Mid cap: 10% Small cap: 88% Cash & others: 2% By sector: Financial Services: 28.9% Capital Goods: 23.6% Healthcare: 21.1% Automobile & Auto Components: 8.4% Metals & Mining: 3.1% Others: 13.2% Cash: 1.7% That sector mix leans into the same broad India themes as Sundaram Alternates' other strategies — financial-services and capital-goods exposure tied to formal-credit penetration and the manufacturing capex cycle — but expressed almost entirely through smaller, less-covered companies rather than the large- or mid-cap names that typically dominate those themes in a diversified portfolio. Sector allocation of the Sundaram Rising Stars small-cap PMS model portfolio as of 31 July 2026, led by Financial Services at 28.9% and Capital Goods at 23.6% Rising Stars sector mix and market-cap split (31 July 2026) The investment philosophy: quality and cyclicality in the small-cap universe Sundaram Alternates' stated case for dedicated small-cap exposure rests on a simple observation: small and mid-cap stocks are structurally less researched and more prone to being mispriced than large caps, which — over a full market cycle — has historically rewarded patient, quality-focused stock-picking with a meaningful alpha over broad indices. The flip side, which the firm is explicit about, is that this space also carries sharper drawdowns and needs a genuinely long holding period to pay off. Rising Stars is built around a "healthy mix of compounder and cyclical stocks," identified through the same 3Q selection criteria used across Sundaram Alternates' equity PMS strategies: Quality of Business — scalability, a self-sustaining business model, and a genuine, defensible competitive edge (cost leadership, brand strength or execution moat) rather than a temporary one. Quality of Financials — the ability to double earnings in 4-5 years, funded by reinvested cash rather than dilution or debt: a minimum 15% return on invested capital, operating cash flow to EBITDA above 50%, and debt-to-equity kept under 0.5x. Quality of Management — a credible execution track record, a coherent long-term vision, a history of deploying capital into genuinely profitable growth, and a clean corporate governance record. The strategy describes its own approach as a concentrated bet on a small number of good small-cap businesses , aiming to identify long-term trends and invest early in them, and favouring management teams that are themselves committed to growth — rather than attempting to hold a statistically diversified basket across the small-cap universe. Track record and independent recognition Rising Stars has now run for more than sixteen years — through the 2013 taper tantrum, the 2018 NBFC crisis and small-cap correction, the 2020 pandemic crash, and the 2022 rate-hike drawdown — making it the longest-tenured of Sundaram Alternates' four PMS strategies and one of the longer-running small-cap PMS track records available in the Indian market generally. The strategy carries a 3-star CRISIL-powered rating in the Small and Midcap Funds category (FY21-22 ratings cycle) — CRISIL-powered, third-party ratings widely referenced across the Indian PMS industry as an independent quality signal — alongside its own live performance track record on the Association of Portfolio Managers in India (APMI) performance portal (https://www.apmiindia.org/apmi/welcomeiaperformance.htm?action=PMSmenu) , where all SEBI-registered portfolio managers are required to disclose standardised, comparable returns. How Rising Stars compares with Sundaram Alternates' other three PMS strategies Sundaram Alternates runs four distinct equity PMS strategies. Here is how Rising Stars stacks up against its sister strategies, using the same 31 August 2026 return snapshot: Strategy Category Inception Cap-curve tilt 1Y return Since Inception CRISIL-powered rating Sundaram SISOP (/insights/sundaram-sisop-pms-review) Concentrated Multi Cap Feb 2010 Large 42% / Mid 32% / Small 24% 38.7% 19.0% ★★★ Sundaram SELF (/insights/sundaram-self-pms-review) Mid Cap Jun 2010 Large 23% / Mid 33% / Small 40% 47.5% 18.5% ★★★ Sundaram Voyager (/insights/sundaram-voyager-pms-review) Multi Cap Nov 2016 Large 40% / Mid 34% / Small 24% 36.1% 16.0% ★★★★ Sundaram Rising Stars (this review) Small & Microcap Nov 2009 Large 0% / Mid 10% / Small 88% 52.5% 15.6% ★★★ Rising Stars is the oldest strategy and carries by far the highest 1-year return in this snapshot, but it's also the only one of the four with zero large-cap exposure — making it the highest-beta, most concentrated small-cap option on the shelf rather than a general-purpose equity allocation. If you're choosing between Sundaram Alternates' four strategies rather than picking Rising Stars in isolation, that cap-curve positioning (not just the trailing return) is the variable that should drive the decision. We compare all four in more depth in our PMS players in India guide (/insights/pms-players-in-india-aum-vintage) . Who runs it Karthik Athreya , Managing Director of Sundaram Alternates, oversees the firm's PMS and private credit franchise. He is a Chartered Accountant and a graduate of Loyola College, Chennai, with over 26 years of experience spanning principal investing, fund management, investment banking and transaction advisory — including leading the India business of Clearwater Capital Partners, a pan-Asian special situations fund, and earlier roles at YES Bank, Arthur Andersen and Rabobank's India operations. Darshan Engineer , Fund Manager, brings 16 years of financial markets experience — 14 years in equities and two years in credit ratings — across PMS and AIF platforms including Alchemy Capital, Karma Capital and Valuequest, with a stated focus on small and mid-cap strategies. He holds an MBA in Finance from the Jamnalal Bajaj Institute of Management Studies, is a computer science engineering graduate from Mumbai University, and previously worked in credit research at CRISIL. Who is Rising Stars suited for — and who should think twice Rising Stars may suit you if: You specifically want dedicated small-cap exposure through a PMS structure rather than a diversified multi-cap or mid-cap mandate — this is Sundaram Alternates' purest small-cap offering. You can commit to a genuinely long horizon — Sundaram Alternates itself recommends 5+ years for this strategy, longer than for its other three PMS strategies, and the return pattern above shows why: results can take years to show up relative to peers, not just relative to the broad market. You already understand and accept small-cap volatility from other parts of your portfolio, and are looking for active, quality-focused stock selection within that allocation rather than a small-cap index fund. You meet the SEBI-mandated ₹50 lakh minimum investment and want direct demat holding rather than a pooled vehicle. Think twice if: You're choosing this strategy purely on the strength of its 1-year return — that number is real, but the since-inception and versus-secondary-benchmark figures tell a more complete, more moderate story. You need capital in the near term. With zero large-cap allocation, Rising Stars will typically see the sharpest drawdowns of Sundaram Alternates' four PMS strategies in a broad market correction. You don't yet have a diversified core portfolio (index funds, diversified equity, an emergency corpus) to sit alongside this — a concentrated, pure small-cap satellite works best layered on top of a stable base, not as a substitute for one. Resident and NRI eligibility Rising Stars, like other SEBI-registered PMS strategies, is open to both resident Indian investors and NRIs, subject to FEMA and RBI guidelines on NRI investment in Indian securities (typically routed through an NRE or NRO account, on a repatriable or non-repatriable basis as applicable). NRI onboarding documentation and account structuring have their own nuances that vary by country of residence and account type — this is an area where it's worth getting it right before you commit capital, since correcting the paperwork after the fact is far more painful than getting a call right beforehand. Money n Wealth's team routinely helps NRI investors structure this correctly; treat this section as a starting point, not a substitute for that conversation or for independent tax advice in your country of residence. Costs and fee structure PMS strategies in India are typically offered with a choice of fee structures — a pure fixed management fee, or a lower fixed fee combined with a performance fee charged above a hurdle rate (often with a high-water mark). Exact current fee schedules for Rising Stars are set out in Sundaram Alternates' Disclosure Document, which every investor is required to receive and review before executing a PMS agreement — and which we'd recommend reading in full rather than relying on any secondary summary, including this one. Money n Wealth can share the current fee card and Disclosure Document on request. It's also worth knowing that PMS is taxed differently from mutual funds: because your PMS holds listed securities directly in your own demat account rather than through pooled fund units, capital gains and dividends flow straight into your personal tax return rather than being computed inside a fund structure. That has real implications for tax planning and reporting, and is a good thing to discuss with your tax advisor before investing, not after your first statement arrives. Key risks to weigh Small-cap concentration risk. With 88% of the portfolio in small caps and zero large-cap buffer, Rising Stars is the most concentrated-by-cap-curve of Sundaram Alternates' four PMS strategies, and should be expected to see the sharpest drawdowns in a risk-off market. Secondary-benchmark underperformance at longer horizons. As shown above, Rising Stars has trailed the Nifty Smallcap 250 at the 4-year, 7-year and 10-year marks even while beating the S&P BSE 500 TRI throughout — a reminder to judge a small-cap strategy against small-cap peers, not just the broad market. Liquidity. Small-cap stocks are inherently less liquid than large caps, and can be harder to exit at fair value during stressed markets — a more pronounced version of a risk that applies to all equity PMS. Manager and process risk. Returns are a function of the fund manager's stock-picking process; a change in the investment team is a factor worth monitoring for any PMS investor, in any strategy. No guaranteed or assured returns. Under SEBI PMS regulations, no portfolio manager may offer guaranteed or assured returns of any kind — past performance, however strong, is not a promise of future performance. Money n Wealth's view Rising Stars' case rests on genuine longevity — it is Sundaram Alternates' oldest PMS strategy, has compounded through several distinct small-cap cycles, and has just put up the strongest 1-year number on the firm's PMS shelf. We'd encourage reading that alongside the fuller picture rather than in isolation: the since-inception CAGR is the most modest of Sundaram's four strategies, and the strategy has actually lagged its own small-cap benchmark at several longer horizons. None of that disqualifies it — a 16-year track record that beats the broad market throughout, run by a stable team with a disciplined process, is the kind of record worth examining for the small-cap sleeve of a portfolio that can genuinely afford a 5+ year horizon and small-cap-level volatility. The more useful question than "is Rising Stars a good PMS" is whether you actually want zero-large-cap, pure small-cap exposure at all right now, and if so, whether Rising Stars' specific process is the way you want to access it versus a small-cap mutual fund or a different PMS. That's a portfolio-construction and risk-appetite conversation, not a factsheet-reading exercise. If you'd like a Sundaram Rising Stars Disclosure Document, the latest fee card, or a review of how this strategy would sit alongside your existing mutual fund, insurance and direct equity holdings, book a free portfolio review with Money n Wealth (/start-free-review) . Frequently asked questions What is the Sundaram Rising Stars Portfolio? Sundaram Rising Stars Portfolio is a small & microcap equity PMS run by Sundaram Alternates since November 2009 — its oldest PMS strategy — investing in a multi-sector portfolio of around 25 predominantly small-cap stocks. What is the minimum investment in Rising Stars? Like all PMS strategies in India, Rising Stars requires a minimum investment of ₹50 lakh, as mandated by SEBI's Portfolio Managers Regulations. Sundaram Alternates recommends an investment horizon of 5+ years for this strategy. What are Rising Stars' benchmarks, and has it beaten them? Rising Stars benchmarks against the S&P BSE 500 TRI (primary) and the Nifty Smallcap 250 (secondary). As of 31 August 2026, it had beaten the S&P BSE 500 TRI across nearly every period (10-year excess return was marginally negative, at -0.1%), while its record against the Nifty Smallcap 250 is mixed — ahead at 1-3 years and 5 years, behind at 4, 7 and 10 years. Is Rising Stars a large-cap, mid-cap or small-cap fund? It's a dedicated small-cap strategy. As of July 2026 its portfolio held 0% large cap, 10% mid cap and 88% small cap — the most concentrated small-cap positioning of Sundaram Alternates' four PMS strategies. Who manages Rising Stars? Sundaram Alternates' Karthik Athreya (Managing Director) and Darshan Engineer (Fund Manager) lead the strategy, within Sundaram Alternates' broader Sundaram Finance Group. Can NRIs invest in Rising Stars? Yes, subject to FEMA/RBI guidelines on NRI investment in Indian securities. Speak with a PMS distributor familiar with NRI account structuring before investing. How is Rising Stars taxed compared to a mutual fund? Because PMS holdings sit directly in your own demat account, capital gains and dividends are taxed in your hands directly, unlike mutual funds where gains are computed at the fund/unit level. Consult your tax advisor for specifics. Related reading Sundaram SISOP PMS review: the concentrated, benchmark-agnostic multi-cap strategy (/insights/sundaram-sisop-pms-review) Sundaram SELF PMS review: the mid-cap-leaning strategy from the same fund house (/insights/sundaram-self-pms-review) Sundaram Voyager PMS review: the 4-star rated multi-cap strategy (/insights/sundaram-voyager-pms-review) Sundaram Alternates SA Ecco II: inside the ₹2,500 crore Category II private credit AIF (/insights/sundaram-alternates-sa-ecco-ii-review) PMS players in India by AUM and vintage (/insights/pms-players-in-india-aum-vintage) Category II AIF: the powerhouse of India's private capital market (/insights/category-ii-aif-guide) How PMS works: onboarding, funding, taxation and exit (/insights/how-pms-works-onboarding-funding-taxation-exit) PMS vs mutual funds: what ₹1 crore-plus investors should know (/insights/pms-vs-mutual-funds-1-crore-investors) Sources Sundaram Alternates, "Sundaram Rising Stars" strategy presentation, July 2026 Performance data as of 31 August 2026, provided to Money n Wealth by Sundaram Alternates Association of Portfolio Managers in India (APMI) — PMS performance disclosure portal (https://www.apmiindia.org/apmi/welcomeiaperformance.htm?action=PMSmenu) Sundaram Alternates — Rising Stars official product page (https://www.sundaramalternates.com/portfolios/products/sundaram-rising-stars) Disclaimer This article is for general information only and does not constitute investment advice or an offer to invest in the Sundaram Rising Stars Portfolio. Sundaram Alternate Assets Limited (SEBI Portfolio Manager Registration No. INP000006271) is the Portfolio Manager and is solely responsible for the strategy's investment decisions and disclosures. Money n Wealth (Predics Fintech Services Pvt Ltd) is regulated under SEBI's framework as an AMFI-registered Mutual Fund Distributor (ARN-121995) and an APMI-registered Portfolio Manager Distributor (APRN-07444), and is a distributor, not an investment adviser. Investments in securities, including through portfolio management services, are subject to market risk, and clients are not offered any guaranteed or assured returns. The name of the strategy does not indicate its prospects or returns, and performance-related information for PMS strategies is not verified by SEBI. An individual client's portfolio composition and returns may vary from the aggregate strategy-level figures depending on the timing of investment and other client-specific factors. Please read the Portfolio Manager's Disclosure Document and all strategy-related documents carefully, and consult us and your tax advisor, before investing.
Frequently Asked Questions
What is the Sundaram Rising Stars Portfolio?
Sundaram Rising Stars Portfolio is a small & microcap equity PMS run by Sundaram Alternates since November 2009 — its oldest PMS strategy — investing in a multi-sector portfolio of around 25 predominantly small-cap stocks.
What is the minimum investment in Rising Stars?
Like all PMS strategies in India, Rising Stars requires a minimum investment of ₹50 lakh, as mandated by SEBI's Portfolio Managers Regulations. Sundaram Alternates recommends an investment horizon of 5+ years for this strategy.
What are Rising Stars' benchmarks, and has it beaten them?
Rising Stars benchmarks against the S&P BSE 500 TRI (primary) and the Nifty Smallcap 250 (secondary). As of 31 August 2026, it had beaten the S&P BSE 500 TRI across nearly every period (10-year excess return was marginally negative, at -0.1%), while its record against the Nifty Smallcap 250 is mixed — ahead at 1-3 years and 5 years, behind at 4, 7 and 10 years.
Is Rising Stars a large-cap, mid-cap or small-cap fund?
It's a dedicated small-cap strategy. As of July 2026 its portfolio held 0% large cap, 10% mid cap and 88% small cap — the most concentrated small-cap positioning of Sundaram Alternates' four PMS strategies.
Who manages Rising Stars?
Sundaram Alternates' Karthik Athreya (Managing Director) and Darshan Engineer (Fund Manager) lead the strategy, within Sundaram Alternates' broader Sundaram Finance Group.
Can NRIs invest in Rising Stars?
Yes, subject to FEMA/RBI guidelines on NRI investment in Indian securities. Speak with a PMS distributor familiar with NRI account structuring before investing.
How is Rising Stars taxed compared to a mutual fund?
Because PMS holdings sit directly in your own demat account, capital gains and dividends are taxed in your hands directly, unlike mutual funds where gains are computed at the fund/unit level. Consult your tax advisor for specifics.
