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Fincash » Franklin India Smaller Companies Vs HDFC Small Cap Fund

Franklin India Smaller Companies Fund Vs HDFC Small Cap Fund

Updated on May 14, 2024 , 2135 views

Franklin India Smaller Companies Fund and HDFC Equity Fund both belong to the small-cap category of equity fund. These schemes invest their corpus in shares of companies having a Market capitalization of less than INR 500 Crores. Small-cap companies are either start-ups or are in their early stages of development. These schemes form the bottom of the pyramid when Equity Funds are compared on the Basis of market capitalization. In many situations, small-cap schemes have performed better as compared to others. Though Franklin India Smaller Companies Fund and HDFC Small Cap Fund belong to the same category of Small cap funds, yet they differ on account of numerous parameters such as performance, NAV, AUM, and so on. So, let’s understand the differences between both the schemes through this article.

Franklin India Smaller Companies Fund

Franklin India Smaller Companies Fund is managed and offered by Franklin Templeton Mutual Fund under the small-cap category. This scheme was launched in the month of January 2006. Franklin India Smaller Companies Fund uses Nifty Free Float Midcap 100 Index and Nifty 50 Index as its benchmark to construct the Portfolio. As on March 31, 2018, some of the top 10 holdings of Franklin India Smaller Companies Fund’s portfolio consisted of HDFC Bank Limited, Finolex Cables Limited, Voltas Limited, and Cyient Limited. The scheme is managed by Mr. Janakiraman, Mr. Hari Shyamsunder, and Mr. Shrikesh Nair. Franklin India Smaller Companies Fund is suitable for individuals seeking for long-term Capital growth generated from a fund that primarily invests in small and mid-cap companies.

HDFC Small Cap Fund

HDFC Small Cap Fund is an open-ended small-cap scheme offered by HDFC Mutual Fund. This scheme was launched on April 3, 2008, and its objective is to achieve capital growth in the long-term by Investing mostly in small-cap and mid-cap companies. NIFTY Smallcap 100 Index is the primary benchmark and NIFTY 50 Index is the additional benchmark used by HDFC Small Cap Fund to construct its portfolio. Mr. Chirag Setalvad and Mr. Rakesh Vyas jointly manage the performance of HDFC Small Cap Fund. As on March 31, 2018, some of the top constituents of HDFC Small Cap Fund include Sonata Software Limited, SKF India Limited, Tata Metaliks Limited, and Aurobindo Pharma Limited. As per the Asset Allocation composition, the HDFC Small Cap Fund invests around 80-100% of its fund money in shares of small cap companies and the remaining in mid-cap companies.

Franklin India Smaller Companies Fund Vs HDFC Small Cap Fund

There are numerous differences between Franklin India Smaller Companies Fund and HDFC Small Cap Fund on account of various parameters. So, let us understand the differences between these schemes that are categorized in the following sections.

Basics Section

Being the first section, it compares elements such as current NAV, Fincash Rating, and scheme category. With respect to Fincash Rating, it can be said that both the schemes are rated as 4-Star schemes. The comparison of current NAV reveals that there is a difference between the NAV of both the schemes. The NAV of Franklin India Smaller Companies Fund was approximately INR 47 while of HDFC Small Cap Fund was around INR 61, as of April 24, 2018. Even the comparison of scheme category shows that both the schemes belong to the same category, that is, Equity Mid & Small-Cap. The table given below shows the comparison summary of the basics section.

Parameters
BasicsNAV
Net Assets (Cr)
Launch Date
Rating
Category
Sub Cat.
Category Rank
Risk
Expense Ratio
Sharpe Ratio
Information Ratio
Alpha Ratio
Benchmark
Exit Load
Franklin India Smaller Companies Fund
Growth
Fund Details
₹164.393 ↑ 2.57   (1.59 %)
₹11,540 on 31 Mar 24
13 Jan 06
Equity
Small Cap
11
Moderately High
1.89
2.96
0.19
2.65
Not Available
0-1 Years (1%),1 Years and above(NIL)
HDFC Small Cap Fund
Growth
Fund Details
₹125.146 ↑ 1.27   (1.03 %)
₹27,574 on 31 Mar 24
3 Apr 08
Equity
Small Cap
9
Moderately High
1.82
2.62
0
0
Not Available
0-1 Years (1%),1 Years and above(NIL)

Performance Section

It is the second section in the comparison which analyses the difference in the Compounded Annual Growth Rate or CAGR returns of both the scheme. These CAGR returns are compared at different time intervals such as 6 Month Return, 3 Year Return, 5 Year Return, and Return Since Inception. The comparison of the performance section reveals that in certain instances, HDFC Small Cap Fund leads the race while in others Franklin India Smaller Companies Fund leads the race. The summary comparison of the performance is as shown in the table given below.

Parameters
Performance1 Month
3 Month
6 Month
1 Year
3 Year
5 Year
Since launch
Franklin India Smaller Companies Fund
Growth
Fund Details
4.6%
6.7%
20.3%
55.6%
32.6%
25.8%
16.4%
HDFC Small Cap Fund
Growth
Fund Details
1.1%
1.7%
14.8%
42.3%
29.7%
24.7%
16.9%

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Yearly Performance Section

Being the third section in the comparison, it analyzes the difference in the absolute returns generated by both the schemes for a particular year. In yearly performance section too, the comparison reveals that for certain years HDFC Small Cap Fund has performed better while for other Franklin India Smaller Companies Fund has done better. The table given below summarizes the comparison of yearly performance section.

Parameters
Yearly Performance2023
2022
2021
2020
2019
Franklin India Smaller Companies Fund
Growth
Fund Details
52.1%
3.6%
56.4%
18.7%
-5%
HDFC Small Cap Fund
Growth
Fund Details
44.8%
4.6%
64.9%
20.2%
-9.5%

Other Details Section

It is the last section in the comparison that includes elements such as AUM, minimum SIP and lumpsum investment, and others. With respect to minimum SIP and lumpsum investment, it can be said that both the schemes have the same amount. The minimum SIP amount for both the schemes is INR 500 and minimum lumpsum investment is INR 5,000. However, the comparison of AUM shows there is a drastic difference between the AUMs of the schemes. As on March 31, 2018, the AUM of HDFC Small Cap Fund is approximately INR 2,968 Crores while of Franklin India Smaller Companies Fund is approximately INR 7,007 Crores. The comparison summary of this section is tabulated as follows.

Parameters
Other DetailsMin SIP Investment
Min Investment
Fund Manager
Franklin India Smaller Companies Fund
Growth
Fund Details
₹500
₹5,000
R. Janakiraman - 13.17 Yr.
HDFC Small Cap Fund
Growth
Fund Details
₹300
₹5,000
Chirag Setalvad - 9.77 Yr.

Growth of 10k Investments over the years

Growth of 10,000 investment over the years.
Franklin India Smaller Companies Fund
Growth
Fund Details
DateValue
30 Apr 19₹10,000
30 Apr 20₹6,943
30 Apr 21₹12,752
30 Apr 22₹16,718
30 Apr 23₹18,671
30 Apr 24₹29,996
Growth of 10,000 investment over the years.
HDFC Small Cap Fund
Growth
Fund Details
DateValue
30 Apr 19₹10,000
30 Apr 20₹6,705
30 Apr 21₹12,755
30 Apr 22₹16,795
30 Apr 23₹19,360
30 Apr 24₹29,246

Detailed portfolio Comparison

Asset Allocation
Franklin India Smaller Companies Fund
Growth
Fund Details
Asset ClassValue
Cash6%
Equity93.84%
Equity Sector Allocation
SectorValue
Industrials26.54%
Financial Services19.57%
Consumer Cyclical13.14%
Health Care7.5%
Technology6.65%
Basic Materials6.28%
Real Estate5.5%
Consumer Defensive4.15%
Utility1.08%
Energy1.05%
Communication Services0.82%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Equitas Small Finance Bank Ltd Ordinary Shares (Financial Services)
Equity, Since 31 Oct 20 | 543243
4%₹445 Cr48,064,081
Brigade Enterprises Ltd (Real Estate)
Equity, Since 30 Jun 14 | 532929
4%₹437 Cr4,668,691
↑ 25,000
Kalyan Jewellers India Ltd (Consumer Cyclical)
Equity, Since 31 May 22 | 543278
3%₹375 Cr8,763,469
Multi Commodity Exchange of India Ltd (Financial Services)
Equity, Since 30 Jun 20 | MCX
3%₹299 Cr892,402
Deepak Nitrite Ltd (Basic Materials)
Equity, Since 31 Jan 16 | 506401
3%₹295 Cr1,387,967
Karur Vysya Bank Ltd (Financial Services)
Equity, Since 31 Oct 12 | 590003
2%₹281 Cr15,398,917
Aster DM Healthcare Ltd Ordinary Shares (Healthcare)
Equity, Since 31 Jul 23 | 540975
2%₹266 Cr6,488,964
↑ 1,892,958
KPIT Technologies Ltd (Technology)
Equity, Since 31 Aug 20 | 542651
2%₹263 Cr1,772,610
↓ -100,000
ICICI Bank Ltd (Financial Services)
Equity, Since 28 Feb 21 | ICICIBANK
2%₹247 Cr2,259,945
J.B. Chemicals & Pharmaceuticals Ltd (Healthcare)
Equity, Since 30 Jun 14 | 506943
2%₹239 Cr1,448,723
↓ -140,253
Asset Allocation
HDFC Small Cap Fund
Growth
Fund Details
Asset ClassValue
Cash9.2%
Equity90.8%
Equity Sector Allocation
SectorValue
Industrials25.66%
Consumer Cyclical17.43%
Technology13.31%
Financial Services12.38%
Health Care10.77%
Basic Materials4.93%
Consumer Defensive3.17%
Communication Services2.71%
Utility0.43%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Sonata Software Ltd (Technology)
Equity, Since 31 Oct 17 | 532221
5%₹1,241 Cr17,178,253
↓ -1,451,557
Firstsource Solutions Ltd (Technology)
Equity, Since 31 Mar 18 | 532809
4%₹1,155 Cr58,422,707
↑ 1,552,248
Bank of Baroda (Financial Services)
Equity, Since 31 Mar 19 | 532134
4%₹1,131 Cr42,828,792
eClerx Services Ltd (Technology)
Equity, Since 31 Mar 18 | 532927
3%₹840 Cr3,546,409
↑ 17,531
Aster DM Healthcare Ltd Ordinary Shares (Healthcare)
Equity, Since 30 Jun 19 | 540975
3%₹800 Cr19,556,503
↑ 1,917,151
Great Eastern Shipping Co Ltd (Industrials)
Equity, Since 31 Jan 15 | GESHIP
2%₹641 Cr6,404,655
Power Mech Projects Ltd (Industrials)
Equity, Since 31 Aug 15 | POWERMECH
2%₹583 Cr1,162,932
PNC Infratech Ltd (Industrials)
Equity, Since 31 Oct 15 | PNCINFRA
2%₹567 Cr12,986,529
Equitas Small Finance Bank Ltd Ordinary Shares (Financial Services)
Equity, Since 31 Dec 20 | 543243
2%₹561 Cr60,564,526
Bajaj Electricals Ltd (Consumer Cyclical)
Equity, Since 31 Mar 19 | 500031
2%₹534 Cr5,882,744

Therefore, from the above pointers, it can be said that there are differences between both the schemes on account of various parameters. As a result, individuals should be careful before investing in any of the schemes. They should understand the modalities of a scheme completely and check whether it is in-line with their objective or not. This will help them to attain their objectives on time and ensure that their investment is safe.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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