SBI Long-Term Equity Fund, the oldest scheme in the Equity Linked Saving Scheme (ELSS) category, has outperformed the benchmark in one-, three-, and five-year periods. As per SBI Mutual Fund, the scheme has generated returns of 57.86% for one year and 26.53% for three years.
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Over five years, the mutual fund has generated a 22.18% return.
Here's a look at these returns in comparison to benchmarks:
| Compounded Annualised Growth Rate (CAGR) performance | 1 year | 3 year | 5 year | Since Inception | |
| SBI Long-Term Equity Fund | 57.86% | 26.53% | 22.18% | 16.54% | |
| Scheme Benchmark: S&P BSE 500 TRI | 39.34% | 19.41% | 18.98% | NA | |
| Additional Benchmark: S&P BSE Sensex TRI | 24.51% | 15.21% | 16.48% | 13.39% |
(Source: SBI Mutual Fund)
About the fund
SBI Long-Term Equity Fund aims to provide investors with the dual benefits of investing in a diversified portfolio of equity shares while offering tax deductions under Section 80C of the Income Tax Act, 1961.
With a statutory lock-in period of three years, the fund encourages long-term wealth creation while ensuring tax efficiency for investors.
The asset under management (AUM) of the fund is about ₹21,202 crore, the fund house said.
The allotment date of this fund is March 31, 1993.
Risk and reward
The fund's standard deviation of 21.51% and beta of 0.93 signify moderate volatility, indicating that investors should be prepared for fluctuations in returns.
However, the fund's sharpe ratio of 0.63 suggests a favourable risk-adjusted return, reflecting its ability to generate returns while managing risk efficiently.
Portfolio composition
The fund's portfolio comprises a mix of equity shares, with top holdings including prominent names like ICICI Bank Ltd., Larsen & Toubro Ltd., and Reliance Industries Ltd.
| Stock name | Percentage of total AUM |
|---|---|
| ICICI Bank Ltd | 5.21% |
| Larsen & Toubro Ltd | 4.28% |
| Cummins India Ltd | 3.99% |
| Reliance Industries Ltd | 3.70% |
| Mahindra & Mahindra Ltd | 3.57% |
| HDFC Bank Ltd | 3.48% |
| State Bank of India | 3.30% |
| Bharti Airtel Ltd | 3.21% |
| Axis Bank Ltd | 3.12% |
| Infosys Ltd | 3.10% |
| ITC Ltd | 2.74% |
| Cipla Ltd | 2.54% |
| Tech Mahindra Ltd | 2.41% |
| Mahindra & Mahindra Financial Services Ltd | 2.33% |
| ICICI Prudential Life Insurance Company Ltd | 2.32% |
| GAIL (India) Ltd | 2.21% |
| Housing Development Finance Corporation Ltd | 2.05% |
| Oil & Natural Gas Corporation Ltd | 2.00% |
| NTPC Ltd | 1.82% |
| Equitas Small Finance Bank Ltd | 1.79% |
| AIA Engineering Ltd | 1.79% |
| Torrent Power Ltd | 1.61% |
| The Phoenix Mills Ltd | 1.46% |
| Lupin Ltd | 1.46% |
| Bharat Petroleum Corporation Ltd | 1.42% |
| Tata Motors Ltd - Dvr | 1.37% |
| Wipro Ltd | 1.21% |
| Tata Steel Ltd | 1.20% |
| Sundaram Clayton Ltd | 1.16% |
| Multi Commodity Exchange Of India Ltd | 1.14% |
| Indian Oil Corporation Ltd | 1.09% |
| Shree Cement Ltd | 1.08% |
| Rallis India Ltd | 1.08% |
| GE T&D India Ltd | 1.07% |
| Tata Motors Ltd | 0.92% |
| Punjab National Bank | 0.90% |
| Prism Johnson Ltd | 0.89% |
| DLF Ltd | 0.87% |
| Chemplast Sanmar Ltd | 0.87% |
| Container Corporation Of India Ltd | 0.79% |
| Godrej Consumer Products Ltd | 0.76% |
| ACC Ltd | 0.72% |
| Sanofi India Ltd | 0.71% |
| IRB Infrastructure Developers Ltd | 0.66% |
| ICICI Lombard General Insurance Company Ltd | 0.58% |
| Aster Dm Healthcare Ltd | 0.55% |
| Strides Pharma Science Ltd | 0.50% |
| Hindustan Copper Ltd | 0.42% |
| VA Tech Wabag Ltd | 0.40% |
| Crompton Greaves Consumer Electricals Ltd | 0.38% |
| Indian Bank | 0.33% |
| The New India Assurance Company Ltd | 0.32% |
| PB Fintech Ltd | 0.30% |
| Exide Industries Ltd | 0.30% |
| Computer Age Management Services Ltd | 0.30% |
| Grindwell Norton Ltd | 0.18% |
| Zomato Ltd | 0.03% |
| Ambuja Cements Ltd | 0.02% |
| Total | 90.01% |
(Source: SBI Mutual Fund)
Fund manager
Dinesh Balachandran manages the ELSS fund.
Investment considerations
Equity Linked Savings Schemes (ELSS) have long been favoured by investors seeking a dual benefit of tax savings and potential wealth creation through equity investments.
However, the introduction of a new tax regime has prompted some investors to reconsider their investment allocations lately.
Notably, the new tax regime presents alternative investment avenues not solely dependent on income tax deductions.
The SBI Long-Term Equity Fund, in particular, presents a decent investment opportunity given its consistent track record of outperformance.
However, investors should assess their risk tolerance and investment objectives before making any decisions.
(Edited by : Vijay Anand)
First Published: Mar 18, 2024 5:01 PM IST
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