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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 August 3, 2022 , 1538 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
₹88.5589 ↑ 0.46   (0.52 %)
₹6,208 on 30 Jun 22
13 Jan 06
Equity
Small Cap
11
Moderately High
1.96
0.03
-0.45
4.36
Not Available
0-1 Years (1%),1 Years and above(NIL)
HDFC Small Cap Fund
Growth
Fund Details
₹72.203 ↓ -0.01   (-0.01 %)
₹11,753 on 30 Jun 22
3 Apr 08
Equity
Small Cap
9
Moderately High
1.92
-0.27
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
9.9%
1.8%
-4.6%
5.7%
23.9%
10.1%
14.1%
HDFC Small Cap Fund
Growth
Fund Details
9.2%
3.5%
-5.6%
2.7%
24.9%
14%
14.8%

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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 Performance2021
2020
2019
2018
2017
Franklin India Smaller Companies Fund
Growth
Fund Details
56.4%
18.7%
-5%
-17.4%
43.5%
HDFC Small Cap Fund
Growth
Fund Details
64.9%
20.2%
-9.5%
-8.1%
60.8%

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 - 15.35 Yr.
HDFC Small Cap Fund
Growth
Fund Details
₹300
₹5,000
Chirag Setalvad - 8.1 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
31 Jul 17₹10,000
31 Jul 18₹10,420
31 Jul 19₹8,734
31 Jul 20₹7,544
31 Jul 21₹15,210
31 Jul 22₹15,901
Growth of 10,000 investment over the years.
HDFC Small Cap Fund
Growth
Fund Details
DateValue
31 Jul 17₹10,000
31 Jul 18₹11,725
31 Jul 19₹10,003
31 Jul 20₹8,873
31 Jul 21₹18,534
31 Jul 22₹18,639

Detailed portfolio Comparison

Asset Allocation
Franklin India Smaller Companies Fund
Growth
Fund Details
Asset ClassValue
Cash4.6%
Equity95.4%
Equity Sector Allocation
SectorValue
Industrials25.5%
Consumer Cyclical15.6%
Financial Services15.47%
Basic Materials10.83%
Real Estate6.72%
Consumer Defensive6.32%
Health Care6.21%
Technology4.07%
Communication Services3.09%
Energy1.59%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Brigade Enterprises Ltd (Real Estate)
Equity, Since 30 Jun 14 | 532929
5%₹309 Cr6,950,570
Deepak Nitrite Ltd (Basic Materials)
Equity, Since 31 Jan 16 | DEEPAKNTR
4%₹241 Cr1,387,967
KPIT Technologies Ltd (Technology)
Equity, Since 31 Aug 20 | KPITTECH
3%₹211 Cr4,077,593
CCL Products (India) Ltd (Consumer Defensive)
Equity, Since 30 Apr 19 | CCL
3%₹194 Cr5,051,976
Tube Investments of India Ltd Ordinary Shares (Consumer Cyclical)
Equity, Since 30 Sep 19 | TIINDIA
3%₹184 Cr1,000,416
J.B. Chemicals & Pharmaceuticals Ltd (Healthcare)
Equity, Since 30 Jun 14 | JBCHEPHARM
3%₹183 Cr1,161,988
GHCL Ltd (Basic Materials)
Equity, Since 30 Sep 16 | GHCL
3%₹168 Cr2,976,441
↓ -357,031
ICICI Bank Ltd (Financial Services)
Equity, Since 28 Feb 21 | ICICIBANK
3%₹160 Cr2,259,945
Jyothy Labs Ltd (Consumer Defensive)
Equity, Since 31 Dec 15 | 532926
2%₹154 Cr10,263,765
Finolex Cables Ltd (Industrials)
Equity, Since 31 Mar 12 | FINCABLES
2%₹143 Cr3,812,021
Asset Allocation
HDFC Small Cap Fund
Growth
Fund Details
Asset ClassValue
Cash6.16%
Equity93.84%
Equity Sector Allocation
SectorValue
Industrials23.67%
Consumer Cyclical21.4%
Technology14.07%
Basic Materials12.17%
Financial Services9.44%
Health Care6.17%
Consumer Defensive4.26%
Communication Services2.67%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Bajaj Electricals Ltd (Consumer Cyclical)
Equity, Since 31 Mar 19 | BAJAJELEC
5%₹562 Cr5,485,727
↓ -95,000
Sonata Software Ltd (Technology)
Equity, Since 31 Oct 17 | SONATSOFTW
5%₹543 Cr8,105,875
↑ 34,531
Firstsource Solutions Ltd (Technology)
Equity, Since 31 Mar 18 | FSL
4%₹499 Cr48,455,000
eClerx Services Ltd (Technology)
Equity, Since 31 Mar 18 | ECLERX
3%₹357 Cr1,861,468
↑ 12,599
Sharda Cropchem Ltd (Basic Materials)
Equity, Since 31 Mar 18 | 538666
3%₹356 Cr5,630,000
Bank of Baroda (Financial Services)
Equity, Since 31 Mar 19 | 532134
3%₹324 Cr33,314,201
↑ 1,500,000
Aster DM Healthcare Ltd Ordinary Shares (Healthcare)
Equity, Since 30 Jun 19 | ASTERDM
3%₹294 Cr16,512,928
Gujarat Fluorochemicals Ltd Ordinary Shares (Basic Materials)
Equity, Since 31 Oct 19 | FLUOROCHEM
2%₹288 Cr1,036,848
↓ -51,829
PNC Infratech Ltd (Industrials)
Equity, Since 31 Oct 15 | PNCINFRA
2%₹285 Cr11,772,819
Chambal Fertilisers & Chemicals Ltd (Basic Materials)
Equity, Since 28 Feb 18 | CHAMBLFERT
2%₹279 Cr10,500,000
↓ -1,943,364

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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