Value Research Given 4 Star To This Small-Cap Mutual Fund SIP, Ticked Upto 44.97% Return

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Personal Finance
oi-Kuntala Sarkar

| Updated: Monday, June 13, 2022, 9:52 [IST]

The annualized returns from mutual funds and SIPs are bearish at present, and investors are worried. Due to repo rate hike, mounting inflation, and downfall in the corporates’ profitability, the mutual fund markets are not experiencing a good time now. However, the size of the mutual fund markets is growing up gradually. Hence, investors should check and analyze the portfolio of the fund.

SBI Small Cap Fund – Regular Plan-Growth

This small-cap fund has performed quite well in the long term for SIPs. In the last 1 year SIP return (absolute return) stood at -1.34%, in the last 2 years it has fetched 27.33% returns, in the last 3 years it has given 50.92% returns, in the last 5 years, it has fetched 67.06% returns, and in the last 10 years, it has fetched 239.89% returns. Annualized returns from SBI Small Cap Fund – Regular Plan’s SIP were 25.15% in the past 2 years, and 28.65% in the past 3 years. However, due to a downfall in the equity market, this fund’s annualized return has fallen by 2.47% in the past 1 year.

SBI Small Cap Fund – Regular Plan’s absolute mutual fund returns are eventually quoted as the best in the long term. In the last 1 year return stood at 9.25%, in the last 2 years it has fetched 110.16% returns, in the last 3 years it has given 91.41% returns, in the last 5 years it has given 129.69% returns, and in the last 10 years, it has given 851.95% returns. In the past 2 years, the SBI Small Cap Fund – Regular Plan’s annualized returns stood at 44.97%, quoted marginally lower than the category average at 45.74%. Additionally, in the past 3 years, its annualized return has been quoted at 24.14%.

(Data till June 10, 2022)

NAV and AUM

SBI Small Cap Fund – Regular Plan is a small-cap mutual fund SIP investment option that has a NAV of Rs. 99.38, and the size – Of assets Under Management (AUM) of this fund is Rs. 11830.75 crore. However, the Expense Ratio (ER) of this fund is 2.02%, while the category average is 1.38%. An Expense Ratio (ER) can be identified as the cost of owning a mutual fund or SIP, which will be charged by the mutual fund house from the retail investors, for the purpose to manage a fund. In the case of the SBI Small Cap Fund – Regular Plan, the ER is marginally higher than the category average, so it can affect the profit quotient for the investors. In addition to that, AUM or fund size is known as the total market value of the fund’s assets, while NAV is the unit price of the fund. So, with a lower NAV, an investor can obtain more units of it than a fund with a higher NAV.

This above-mentioned mutual fund SIP has been best rated with 4 Star by rating agency Value Research.

Portfolio

SBI Small Cap Fund – Regular Plan’s total equity holding is 88.61%, and the rest of the 3.04% is invested in other sectors. Among a total of 72 stocks, the Fund’s Mid Cap Investments are 6.71%; Small Cap Investments are 57.04%, and 24.86% investments are allocated to other funds. There is no large-cap stock investment under this fund.

The top 10 equity holdings of the fund are Elgi Equipments Ltd., Sheela Foam Ltd., Vedant Fashions Ltd., Blue Star Ltd., V-Guard Industries Ltd., Fine Organic Industries Ltd., Carborundum Universal Ltd., Lemon Tree Hotels Ltd., Navin Flourine International Ltd., and Chalet Hotels Ltd.

Other funds under this category are, SBI Small Cap Fund – direct plan, Nippon India Small Cap Fund, Axis Small Cap Fund – Regular Plan, Kotak Small Cap Fund – Regular Plan, Canara Robeco Small Cap Fund – Regular Plan, etc.

(Also read: Best Rated Value Mutual Fund Given Upto 161% Returns: What Is A Value Fund?)

Small-cap investment: should you invest in small-cap funds?

In the equity markets, a small cap mutual fund is known as the funds, where the fund house will invest mostly in the small-cap stocks. These stocks will be of the companies that are below the top 250 stocks in the equity markets, based on their market capitalization. The small cap mutual funds are selected by investors as these are known to offer higher returns in the short term. In the long term, the funds have the opportunity to grow massively, based on multiple factors. So, investors like to select these funds. However, investors with a higher risk appetite generally go for the small cap funds.

Disclaimer

Investing in equities/mutual funds/SIPs/debts poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, and the author are not liable for any losses caused as a result of decisions based on the article.

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