TATA Mutual Fund Small Cap Scheme gives multibagger returns:The small cap scheme of Tata Mutual Fund has given huge profits to investors in the last 5 years. The lump sum investment made in Tata Small Cap Fund 5 years ago has increased by more than four and a half times, while the investment made through Systematic Investment Plan (SIP) has also given more than 3 times the return. Due to this return, the fund value of SIP of Rs 5000 every month has become Rs 9.28 lakh in 5 years, while a lump sum investment of Rs 1 lakh has turned into Rs 4.65 lakh. We will tell you the complete details of this return later, but first let us get some important information about the small cap scheme of Tata Mutual Fund.
Investment Strategy of Tata Small Cap Fund
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Tata Small Cap Fund aims to invest in those companies which can increase profits in the coming 3-4 years.
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The focus of this fund remains on stocks of such companies with strong balance sheets, which are available at the right valuations.
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Keeping in mind the risk associated with investing in smaller companies, this fund aims to deliver superior risk-adjusted returns.
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The investment strategy of the fund is based on ‘Growth at Reasonable Price’, that is, investments are made in such companies which have the ability to earn profits with good cash flow and whose valuation is right.
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Tata Small Cap Fund tries to select companies that can outperform market expectations, so that their value can increase rapidly in the future.
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Past performance of Tata Small Cap Fund
The past performance of Tata Small Cap Fund has been much better than its benchmark index. You can see this in the figures given below.
– 5 Year Returns: 35.31% (Direct), 33% (Regular)
– Benchmark Return (NIFTY Smallcap 250 TRI): 31.17%
– 3 Year Returns: 27.71% (Direct), 25.59% (Regular)
– Benchmark Return: 23.60%
– 1 Year Returns: 50.24% (Direct), 48.11% (Regular)
– Benchmark Return: 47.24%
Thus, this fund has given good returns to investors by outperforming the benchmark in every period.
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1 lakh became Rs 4.65 lakh in 5 years
The Direct Plan of Tata Small Cap Fund has given excellent returns on both lump sum investment and SIP in the last 5 years, the calculation of which you can see here:
Return on Lump Sum Investment
Lump sum investment: Rs 1 lakh
Investment period: 5 years
Current Fund Value (after 5 years): Rs 4,65,740 (Rs 4.65 lakh)
More than 3 times return on SIP investment
Monthly SIP: Rs 5000
Investment period: 5 years
Total investment in 5 years: Rs 3 lakh
Current Fund Value (after 5 years): Rs 9,28,295 (Rs 9.28 lakh)
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More about Tata Small Cap Fund
– Start of the scheme: 12 November 2018
– Assets under management (AUM): Rs 9,119.57 crore (as on 23 October 2024).
– Expense Ratio: 0.29% for Direct Plan and 1.68% for Regular Plan.
– Minimum SIP investment: Rs 100.
– Minimum lump sum investment: Rs 5,000.
– Fund Managers: Chandraprakash Pediar and Jitendra Khatri.
exit load
– 1% on redemptions above 12% within 12 months.
– No exit load on redemption after 12 months.
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Asset Allocation of Tata Small Cap Fund
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Small Cap: 94.28%
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Mid Cap: 5.72%
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Large Cap: 0.00%
Top 10 Equity Holdings
1. BASF India Ltd. – 6.05%
2. Godrej Industries Ltd. – 4.00%
3. Quess Corp Ltd. – 3.99%
4. IDFC Ltd. – 3.53%
5. Kirloskar Pneumatic Company Ltd. – 3.21%
6. Time Technoplast Ltd. – 2.98%
7. Elantas Beck India Ltd. – 2.78%
8. Anant Raj Ltd. – 2.65%
9.UTI Asset Management Company Ltd. – 2.61%
10. Suven Pharmaceuticals Ltd. – 2.60%
What is the allocation in which sector?
1. Capital Goods – 18.21%
2. Chemicals – 10.97%
3. Services – 10.58%
4. Financial Services – 8.91%
5. Healthcare – 8.74%
6. FMCG – 5.08%
7. Realty – 4.77%
8. Consumer Services – 4.66%
9. IT – 4.18%
10. Consumer Durables – 4.08%
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Why invest in Tata Small Cap Fund?
1. Long-term investment option: This fund aims to achieve capital appreciation in the long term, which can be beneficial for investors.
2. Opportunity to invest in small cap companies: This fund invests in those companies which can grow rapidly and whose valuation is reasonable at present.
3. Risk Management: The fund manager has given better returns despite market volatility by selecting the right companies.
4. By investing small amounts through Systematic Investment Plan (SIP), you can make big money in the long run.
5. This fund has given excellent returns even on lump sum investment.
For whom is this scheme suitable?
This scheme is suitable for those investors who want to achieve capital growth by investing in small companies in the long term. The focus of this fund is on those companies which can increase their profits and cash flow over time, thereby increasing their valuation. But the risk level of Tata Small Cap Fund is ‘Very High’, which means that investors investing in this fund should be prepared to take higher risks. Due to investment in small companies, this fund is more affected by market volatility. Therefore, before investing, assess your risk appetite and take the advice of your investment advisor.
(Disclaimer: The purpose of this article is only to provide information and not to advise investment in any fund. The past performance of a mutual fund scheme is not a guarantee of similar returns in the future. Any investment decision should be taken only after taking the advice of your investment advisor. Do.)
