Axis Small Cap Fund
A small cap fund is an equity scheme that primarily invests in small-cap stocks with market capitalization upto Rs. 500 crores. Axis Small Cap Fund is an open-ended equity scheme that invests in small cap companies. The fund identifies high conviction small-cap stocks with long-term growth potential. The fund is suitable for investors with patience to seek capital appreciation and willingness to absorb short-term risks.
Investment Objective
The scheme Invests in equity and equity related instruments in small-cap stocks to generate long-term capital appreciation.
Investment Strategy
- The fund identifies quality small caps which have strong growth potential. The scheme has more than 70% of its investments in small-cap companies and the rest in mid-cap stocks.
- In order to navigate volatile stock movements, Axis small cap fund is actively managed, keeping in mind both growth opportunities and a high degree of risk.
- The fund follows a bottom-up approach to invest in small-cap stocks with an aim to identify long-term businesses.
- The portfolio is diversified to contain mistakes, keeping in mind both risk and reward.
Portfolio Composition
Top Sectors Allocated(% to Net Assets)
Chemicals – 17.62 Financial Services – 7.79
IT – 15.20 Healthcare Services – 7.43
Construction – 10.38 Cement & Cement Products – 6.30
Industrial Manufacturing – 9.94 Automobile – 4.77
Consumer Goods – 9.67 Textiles – 1.67
Top 10 Holdings (% to Net Assets)
Brigade Enterprises Limited – 4.8% JK Lakshmi Cement Limited – 3.5%
Galaxy Surfactants Limited – 4.7% Fine Organic Industries Limited – 3.5%
Birlasoft Limited – 4.1% CCL Products (India) Limited – 3.4%
Narayana Hrudayalaya Limited – 3.8% Krishna Institute Of Medical Sciences Limited – 3.0%
Tata Elxsi Limited – 3.8% Coforge Limited – 2.7%
Risk Measures
Standard Deviation of Fund (Annual): 17.7%,
Beta: 0.69
Sharpe Ratio: 1.18
Fund Facts
| Inception Date | 29/11/2013 |
| Benchmark | Nifty Smallcap 100 TRI |
| Application Amount | Rs. 5000 |
| Min SIP Amount | Rs. 500 |
| Number of stocks | 50 |
| Asset Allocation | Small caps (251st stock onwards) 74.7%
Mid caps (101st-250th stock) 18.0% Debt, Cash & Other Current assets 7.33% |
| Option | IDCW(Income Distribution cum Capital Withdrawal)Payout /Reinvestment
Growth. |
| Axis Small Cap Fund NAV(Rs) | Axis Small Cap Fund Regular Growth – 61.80
Axis Small Cap Fund Direct Growth – 68.44 |
| AUM | Rs 7,695.32 crore |
| Expense Ratio | Regular Plan: 1.91%, Direct Plan: 0.37% |
| Portfolio Turnover | 1.21 |
| Exit Load | 0.5% if more than 10% of the units allotted are redeemed within 90 days and Nil if redeemed after 90 days |
| Degree of Risk | Very High |
| Fund manager | Mr. Anupam Tiwari & Mr. Hitesh Das |
Fund Performance
| Axis Small Cap Fund | |||
| Period | CAGR Returns (%) | ||
| Fund | Benchmark | ||
| Axis Small Cap Fund Growth Plan | |||
| Last 1 Year | 58.98 | 62.98 | |
| Last 3 Years | 31.68 | 20.90 | |
| Last 5 Years | 22.44 | 13.90 | |
| Since Inception | 24.97 | 17.49 | |
| Axis Small Cap Fund Direct Growth Plan | |||
| Last 1 Year | 61.52 | 62.98 | |
| Last 3 Years | 33.65 | 20.90 | |
| Last 5 Years | 24.09 | 13.90 | |
| Since Inception | 26.55 | 17.49 | |
Comparison with Other Similar Funds
| Fund Name | Launch Date | 1 Year Return | 3-Year Return | 5-Year Return | Expense Ratio | Assets (Cr) |
| Axis Small Cap Fund – Direct Plan | Nov’13 | 61.52 | 33.65 | 24.09 | 0.37% | 7,695 |
| Kotak Small Cap Fund – Direct Plan | Feb’05 | 72.46 | 35.38 | 25.13 | 0.48% | 6,535 |
| Tata Small Cap Fund – Direct Plan | Nov’18 | 72.26 | 28.48 | — | 0.36% | 1,765 |
| ICICI Prudential Small Cap Fund – Direct Plan | Oct’07 | 94.95 | 31.22 | 17.42 | 0.64% | 3304 |
How does it work?
Like any other equity mutual fund scheme, Axis small cap fund invests in equity and equity related instruments of companies with small market capitalization. The Asset Management Company collects money from the investors having the same investment objective and invests this sum across the small cap sector. This investment is done under the expertise of experienced fund managers. The investors receive units in exchange of the amount they invested in the fund. The units are allotted according to the scheme’s existing Net Asset Value (NAV). The NAV of the scheme depends on the scheme’s overall performance. The fund manager invests in stocks of small cap companies with growth potential to deliver long-term earnings to investors.
Conclusion
Small cap companies are mostly companies in their beginning phase, companies with small income and start-ups. These companies have good growth potential but financially not very strong, therefore small cap funds have high risk. However, it can deliver incredible returns as well. Before you invest in a small cap fund, keep in mind how much risk you are ready to take, explore and select a fund with a track record of at least 5 years and stay invested for a long term to overcome market risks.
