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Fincash » L&T Emerging Businesses Vs HDFC Small Cap Fund

L&T Emerging Businesses Fund Vs HDFC Small Cap Fund

Updated on July 27, 2021 , 2434 views

L&T Emerging Businesses Fund and HDFC Small Cap Fund both form part of small-cap Mutual Fund schemes. Small cap funds are the ones who invest their corpus in shares of companies having corpus amount of less than INR 500 crores. Small-cap funds form the bottom of the pyramid when schemes are classified on the Basis of market capitalization. These schemes have a high-risk and are considered good Income earners in the long-run. These schemes generally have a low share price thereby; individuals can purchase larger quantities of these shares. Though both L&T Emerging Businesses Fund and HDFC Small Cap Fund belong to the same category yet; they differ on various parameters such as NAV, performance, and so on. So, let us understand the differences between both the schemes.

L&T Emerging Businesses Fund

L&T Emerging Businesses Fund is managed by L&T Mutual Fund. This scheme was launched in the year 2014 and is an open-ended scheme. The scheme invests its corpus predominantly in equity-related of small-cap companies. Through its investments, it tries to attain Capital growth in the long-term. The scheme uses BSE S&P Small Cap Index to construct its portfolio. L&T Emerging Businesses Fund is managed jointly by Mr. Karan Desai and Mr. S. N. Lahiri. As on April 10, 2018, some of the top holdings of L&T Emerging Business Fund include HEG Limited, Lakshmi Machine Works Limited, Ramco Cements Limited, Ipca Laboratories limited, and Nocil Limited. The scheme is suitable for investors who have a high-risk appetite and wish to earn more by Investing in shares of small-cap companies.

HDFC Small Cap Fund

HDFC Small Cap Fund is an open-ended Mutual Fund scheme offered by HDFC Mutual Fund under small cap category. This scheme was launched on April 03, 2008. The objective of the scheme is to generate capital growth in the long-term by primarily investing in shares of small-cap companies. The scheme uses NIFTY Small Cap 100 as its benchmark index to construct its portfolio. It also uses NIFTY 50 as an additional index. The fund managers managing the HDFC Small Cap Fund are Mr. Chirag Setalvad and Mr. Rakesh Vyas. As on March 31, 2018, some of the top holdings of HDFC Small Cap Fund’s portfolio consisted of Sonata Software Limited, SKF India Limited, Tata Metaliks Limited, and Aurobindo Pharma Limited.

L&T Emerging Businesses Fund Vs HDFC Small Cap Fund

Though both L&T Emerging Businesses Fund and HDFC Small Cap Fund belong to the same category of small-cap funds yet, there exists differences between both the schemes. So, let us understand the differences between both the schemes that are divided into four sections, namely, Basics Section, Performance Section, Yearly Performance Section, and Other Details Section.

Basics Section

The basics section is the first one in the comparison of both the schemes. The parameters that form part of this scheme includes scheme category, Fincash Ratings, and Current NAV. To begin with the scheme category, it can be said that both the schemes belong to the same category, that is, Equity Mid & Small-Cap. With respect to Fincash Ratings, it can be said that L&T Emerging Businesses Fund is a 5-Star scheme while HDFC Small Cap Fund is a 4-Star Fund. The comparison of Current NAV between both the schemes portrays that HDFC Small Cap Fund leads the race. As on April 09, 2018, the NAV of L&T Emerging Businesses Fund was approximately INR 27 while the NAV of HDFC Small Cap Fund was approximately INR 46. The table given below summarizes the comparison of both the schemes.

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
L&T Emerging Businesses Fund
Growth
Fund Details
₹40.113 ↑ 0.29   (0.73 %)
₹6,860 on 30 Jun 21
12 May 14
Equity
Small Cap
2
High
1.95
4.48
-0.76
-0.43
Not Available
0-1 Years (1%),1 Years and above(NIL)
HDFC Small Cap Fund
Growth
Fund Details
₹70.397 ↑ 0.75   (1.07 %)
₹12,460 on 30 Jun 21
3 Apr 08
Equity
Small Cap
9
Moderately High
1.95
4.13
0.35
-6.13
Not Available
0-1 Years (1%),1 Years and above(NIL)

Performance Section

The performance section compares the Compounded Annual Growth Rate or CAGR between both the schemes. This CAGR is compared at different time intervals, namely, 3 Month Return, 6 Month Return, 3 Year Return, 5 Year Return, and Return Since Inception. A holistic comparison of both the schemes shows that HDFC Small Cap Fund leads the race. However, at a certain time interval, even, L&T Emerging Businesses Fund has done well. With respect to 5 Year Returns, there is no data in the column of L&T Emerging Business Fund since the scheme was launched in the year 2014 and has not completed 5 years. The summary comparison of performance section is tabulated as follows.

Parameters
Performance1 Month
3 Month
6 Month
1 Year
3 Year
5 Year
Since launch
L&T Emerging Businesses Fund
Growth
Fund Details
7.9%
25%
52.9%
110.8%
15.1%
18.5%
21.2%
HDFC Small Cap Fund
Growth
Fund Details
7.5%
28.1%
51.6%
109.3%
16.5%
19.1%
15.8%

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Yearly Performance Section

It is the third section, in the comparison between both the schemes. In this section, the absolute returns of both the schemes are compared. A comparison of this scheme shows that L&T Emerging Business Fund leads the race in many instances. The summary of yearly performance section is as follows.

Parameters
Yearly Performance2020
2019
2018
2017
2016
L&T Emerging Businesses Fund
Growth
Fund Details
15.5%
-8.1%
-13.7%
66.5%
10.2%
HDFC Small Cap Fund
Growth
Fund Details
20.2%
-9.5%
-8.1%
60.8%
5.4%

Other Details Section

It is the last section in the comparison between both the schemes. The comparable elements forming part of other details section include Minimum SIP and Lumpsum investment, AUM, exit load, and others. With respect to minimum SIP investment, it can be said that in both the schemes, the minimum SIP amount is same, that is INR 500. Likewise, that minimum lumpsum amount is also same for both the schemes that is INR 5,000. The comparison of AUM between both the schemes shows that there is a significant difference between both of them. As on February 28, 2018, the AUM of L&T Emerging Businesses Fund was INR 4,286 crores while the AUM of HDFC Small Cap Fund was INR 2,670 crores. The table given below summarizes the comparison of both the schemes.

Parameters
Other DetailsMin SIP Investment
Min Investment
Fund Manager
L&T Emerging Businesses Fund
Growth
Fund Details
₹500
₹5,000
Venugopal Manghat - 1.54 Yr.
HDFC Small Cap Fund
Growth
Fund Details
₹500
₹5,000
Chirag Setalvad - 7.01 Yr.

Growth of 10k Investments over the years

Growth of 10,000 investment over the years.
L&T Emerging Businesses Fund
Growth
Fund Details
DateValue
30 Jun 16₹10,000
30 Jun 17₹14,542
30 Jun 18₹15,815
30 Jun 19₹14,646
30 Jun 20₹11,419
30 Jun 21₹23,049
Growth of 10,000 investment over the years.
HDFC Small Cap Fund
Growth
Fund Details
DateValue
30 Jun 16₹10,000
30 Jun 17₹13,099
30 Jun 18₹15,460
30 Jun 19₹15,135
30 Jun 20₹11,420
30 Jun 21₹23,597

Detailed Assets & Holdings Comparison

Asset Allocation
L&T Emerging Businesses Fund
Growth
Fund Details
Asset ClassValue
Cash0.46%
Equity99.54%
Equity Sector Allocation
SectorValue
Industrials29.75%
Basic Materials21.45%
Consumer Cyclical14.9%
Technology13.82%
Consumer Defensive8.48%
Health Care4.6%
Real Estate3.6%
Financial Services2.22%
Energy0.7%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
K.P.R. Mill Ltd (Consumer Cyclical)
Equity, Since 28 Feb 15 | 532889
5%₹322 Cr2,112,579
Persistent Systems Ltd (Technology)
Equity, Since 31 Jul 18 | PERSISTENT
4%₹250 Cr850,070
↓ -85,000
Balrampur Chini Mills Ltd (Consumer Defensive)
Equity, Since 31 Jul 19 | 500038
4%₹248 Cr6,974,700
Grindwell Norton Ltd (Industrials)
Equity, Since 30 Sep 17 | 506076
3%₹215 Cr1,734,948
Sonata Software Ltd (Technology)
Equity, Since 31 Jul 18 | 532221
3%₹175 Cr2,338,967
Finolex Industries Ltd Shs Dematerialised (Industrials)
Equity, Since 28 Feb 18 | FINPIPE
2%₹161 Cr8,769,275
Cera Sanitaryware Ltd (Industrials)
Equity, Since 31 Mar 19 | 532443
2%₹150 Cr334,305
↑ 50,000
Supreme Petrochem Ltd (Basic Materials)
Equity, Since 30 Sep 16 | 500405
2%₹145 Cr1,969,120
Emami Ltd (Consumer Defensive)
Equity, Since 30 Jun 19 | 531162
2%₹143 Cr2,550,057
↓ -182,643
Deepak Nitrite Ltd (Basic Materials)
Equity, Since 29 Feb 20 | 506401
2%₹138 Cr765,500
↓ -223,362
Asset Allocation
HDFC Small Cap Fund
Growth
Fund Details
Asset ClassValue
Cash4.77%
Equity95.23%
Equity Sector Allocation
SectorValue
Industrials21.53%
Technology21.25%
Consumer Cyclical13.92%
Basic Materials12.38%
Financial Services7.19%
Health Care6.37%
Consumer Defensive5.06%
Utility5.05%
Communication Services2.47%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
Firstsource Solutions Ltd (Technology)
Equity, Since 31 Mar 18 | 532809
8%₹935 Cr50,000,000
↓ -1,761,038
Bajaj Electricals Ltd (Utilities)
Equity, Since 31 Mar 19 | 500031
5%₹629 Cr6,126,770
Sonata Software Ltd (Technology)
Equity, Since 31 Oct 17 | 532221
5%₹607 Cr8,129,000
↓ -148,500
Persistent Systems Ltd (Technology)
Equity, Since 31 Oct 19 | PERSISTENT
5%₹570 Cr1,941,126
↓ -58,874
Chambal Fertilisers & Chemicals Ltd Shs Dematerialised (Basic Materials)
Equity, Since 28 Feb 18 | 500085
3%₹399 Cr13,000,000
eClerx Services Ltd (Technology)
Equity, Since 31 Mar 18 | 532927
3%₹354 Cr1,824,026
PNC Infratech Ltd (Industrials)
Equity, Since 31 Oct 15 | PNCINFRA
3%₹340 Cr11,793,818
Finolex Industries Ltd Shs Dematerialised (Industrials)
Equity, Since 31 Oct 18 | FINPIPE
2%₹291 Cr15,831,521
↓ -125,100
KEC International Ltd (Industrials)
Equity, Since 30 Sep 18 | 532714
2%₹275 Cr6,080,124
KEI Industries Ltd (Industrials)
Equity, Since 30 Sep 17 | 517569
2%₹267 Cr3,850,003

To conclude, it can be said that, there exists a difference between both the schemes. However, individuals should be careful while in any of the Mutual Fund scheme. They should understand its functioning completely and even check if it matches with their investment objective or not. Individuals can also consider the opinion of a financial advisor if they have any queries. This will help investors to attain their goals on time and in a hassle-free manner.

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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