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L&T Emerging Businesses Fund and Aditya Birla Sun Life Small Cap Fund both the schemes belong to the same category of small-cap fund. In short, Small cap funds are the schemes that invest the corpus in the shares of companies whose Market capitalization is less than INR 500 Crores. These companies are generally start-ups or are in their nascent stages of development. These companies are considered to have good growth potentials and chances to generate good returns in the long-run. Though both L&T Emerging Businesses Fund and ABSL Small Cap Fund belong to the same category, nevertheless; they differ on account of various parameters. So, let’s understand the differences between both the schemes.
This scheme of L&T Mutual Fund was incepted on May 13, 2014, and is offered under the small-cap category. The investment objective of this scheme is to generate long-term Capital growth from a diversified Portfolio consisting of equity-related securities predominantly focusing on small-cap companies. Mr. S. N. Lahiri and Mr. Karan Desai are the Fund managers managing the L&T Emerging Businesses Fund. L&T Emerging Businesses Fund uses S&P BSE Small Cap TRI Index as its yardstick to construct its portfolio. Based on the scheme’s Asset Allocation, it invests around 50-100% in equity and equity-related instruments of small cap companies while the remaining in fixed Income and money market instruments. Some of the key benefits of L&T Emerging Businesses Fund include style diversifier, suitable for investors seeking higher returns, and an experienced investment team.
Aditya Birla Sun Life Small Cap Fund (earlier known as Aditya Birla Sun Life Small & Midcap Fund) is managed and offered by Aditya Birla Sun Life Mutual Fund under the small-cap category. This scheme was launched on May 30, 2007. The objective of this scheme is to attain growth and appreciation in capital by Investing in equity and equity-related instruments of companies belonging to the small and mid-cap sector. Mr. Jayesh Gandhi is the sole fund manager managing the ABSL Small Cap Fund. As on March 31, 2018, some of the top holdings of this Birla Sun Life Mutual Fund’s scheme include Johnson Controls, CG Power & Industrial Solutions Limited, Gujrat State Petronet Limited, and Tata Metaliks Limited. This scheme is suitable for individuals seeking for long-term capital growth by investing in equity and equity-related instruments of small cap companies.
Though both the schemes belong to the same category, yet; they differ on account of numerous parameters. So, let’s understand the differences between these schemes by comparing the parameters that are divided into four sections, namely, basics section, performance section, yearly performance section, and other details section.
Current NAV, Fincash Rating, and scheme category are some of the elements that form part of the basics section. 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. The comparison of current NAV reveals that there is a significant difference between the NAV of both the schemes. As on April 24, 2018, the NAV of L&T Emerging Businesses Fund was approximately INR 28 while of ABSL Small Cap Scheme was nearly INR 42. With respect to Fincash Rating, it can be said that, both the schemes are rated as 5-Star Schemes. The table given below shows the summary comparison of the basics section.
Parameters Basics NAV 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 ₹82.2862 ↑ 0.99 (1.22 %) ₹14,737 on 30 Apr 25 12 May 14 ☆☆☆☆☆ Equity Small Cap 2 High 1.73 -0.3 -0.1 -0.46 Not Available 0-1 Years (1%),1 Years and above(NIL) Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details ₹85.9379 ↑ 0.59 (0.69 %) ₹4,531 on 30 Apr 25 31 May 07 ☆☆☆☆☆ Equity Small Cap 1 Moderately High 1.89 -0.26 0 0 Not Available 0-365 Days (1%),365 Days and above(NIL)
The comparison of Compounded Annual Growth Rate or CAGR returns is done in the performance section. These returns are compared at different intervals such as 3 Month Return, 1 Year Return, 3 Year Return, and 5 Year Return. The comparison of CAGR returns reveals that, in most of the instances, the returns generated by L&T Emerging Businesses Fund is higher than the performance of ABSL Small Cap Fund. The table given below shows the summary comparison of the performance section.
Parameters Performance 1 Month 3 Month 6 Month 1 Year 3 Year 5 Year Since launch L&T Emerging Businesses Fund
Growth
Fund Details 13.8% 17.2% -9.9% 5.2% 24.5% 35.8% 21% Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details 12.2% 18.1% -4.9% 7.9% 21.8% 29.1% 12.6%
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Yearly Performance section is the third section in the comparison of both the schemes. It analyses the difference in the absolute returns generated by both the schemes for a particular year. The comparison of absolute returns also reveals that in most instances, L&T Emerging Businesses Fund has done well. The summarized comparison of the yearly performance section is tabulated as follows.
Parameters Yearly Performance 2024 2023 2022 2021 2020 L&T Emerging Businesses Fund
Growth
Fund Details 28.5% 46.1% 1% 77.4% 15.5% Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details 21.5% 39.4% -6.5% 51.4% 19.8%
It is the last section in the comparison of both the schemes. The comparable elements that form part of other details section include AUM, minimum SIP investment, and minimum lumpsum investment. The comparison of AUM reveals that both the schemes differ on account of AUM. As on March 31, 2018, the AUM of L&T Emerging Businesses Fund was around INR 4,404 Crores while of Aditya Birla Sun Life Small Cap Fund was nearly INR 2,089 Crores. It can be said that both the schemes also differ on account of minimum SIP and lumpsum investment. With respect to minimum SIP amount, in case of L&T Mutual Fund, it is INR 500 while for ABSL Mutual Fund, it is INR 1,000. In the same manner, the minimum lumpsum amount for L&T’s scheme is INR 5,000 while for ABSL’s scheme is INR 1,000. The table given below summarizes the comparison of other details section.
Parameters Other Details Min SIP Investment Min Investment Fund Manager L&T Emerging Businesses Fund
Growth
Fund Details ₹500 ₹5,000 Venugopal Manghat - 5.46 Yr. Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details ₹1,000 ₹1,000 Abhinav Khandelwal - 0.58 Yr.
L&T Emerging Businesses Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 May 20 ₹10,000 31 May 21 ₹21,275 31 May 22 ₹25,707 31 May 23 ₹31,323 31 May 24 ₹46,528 31 May 25 ₹48,396 Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 May 20 ₹10,000 31 May 21 ₹21,617 31 May 22 ₹21,765 31 May 23 ₹25,522 31 May 24 ₹35,709 31 May 25 ₹37,998
L&T Emerging Businesses Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 3.89% Equity 96.11% Equity Sector Allocation
Sector Value Industrials 26.56% Consumer Cyclical 15.68% Financial Services 15.22% Basic Materials 10.89% Technology 9.44% Health Care 7.99% Real Estate 4.93% Consumer Defensive 4.43% Energy 0.97% Top Securities Holdings / Portfolio
Name Holding Value Quantity K.P.R. Mill Ltd (Consumer Cyclical)
Equity, Since 28 Feb 15 | KPRMILL2% ₹351 Cr 3,518,200
↑ 72,900 Neuland Laboratories Ltd (Healthcare)
Equity, Since 31 Jan 24 | 5245582% ₹313 Cr 261,377
↑ 261,377 Aditya Birla Real Estate Ltd (Basic Materials)
Equity, Since 30 Sep 22 | 5000402% ₹306 Cr 1,595,574 The Federal Bank Ltd (Financial Services)
Equity, Since 30 Sep 22 | FEDERALBNK2% ₹306 Cr 15,544,000 KFin Technologies Ltd (Technology)
Equity, Since 31 Aug 24 | KFINTECH2% ₹291 Cr 2,429,736 Nippon Life India Asset Management Ltd Ordinary Shares (Financial Services)
Equity, Since 31 Aug 24 | NAM-INDIA2% ₹284 Cr 4,446,300
↑ 355,900 Multi Commodity Exchange of India Ltd (Financial Services)
Equity, Since 29 Feb 24 | MCX2% ₹279 Cr 455,150
↑ 50,216 Cohance Lifesciences Ltd (Healthcare)
Equity, Since 31 Mar 20 | SUVENPHAR2% ₹261 Cr 2,298,085 Karur Vysya Bank Ltd (Financial Services)
Equity, Since 31 Oct 22 | 5900032% ₹260 Cr 11,912,400 PNB Housing Finance Ltd (Financial Services)
Equity, Since 31 Jul 24 | PNBHOUSING2% ₹259 Cr 2,566,200 Aditya Birla Sun Life Small Cap Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 3.7% Equity 96.3% Equity Sector Allocation
Sector Value Industrials 20.27% Consumer Cyclical 18.36% Financial Services 17.95% Basic Materials 11.65% Health Care 10.44% Consumer Defensive 7.68% Real Estate 5.02% Technology 3.39% Utility 1.54% Top Securities Holdings / Portfolio
Name Holding Value Quantity Multi Commodity Exchange of India Ltd (Financial Services)
Equity, Since 31 Dec 24 | MCX3% ₹141 Cr 230,364
↑ 56,191 Hitachi Energy India Ltd Ordinary Shares (Industrials)
Equity, Since 30 Sep 20 | POWERINDIA2% ₹106 Cr 73,267 Navin Fluorine International Ltd (Basic Materials)
Equity, Since 31 Jul 20 | NAVINFLUOR2% ₹101 Cr 224,193 TD Power Systems Ltd (Industrials)
Equity, Since 30 Jun 23 | TDPOWERSYS2% ₹97 Cr 2,244,418
↓ -67,834 JK Cement Ltd (Basic Materials)
Equity, Since 31 Mar 18 | JKCEMENT2% ₹93 Cr 181,892 Axis Bank Ltd (Financial Services)
Equity, Since 31 Jan 25 | 5322152% ₹89 Cr 750,000 Brigade Enterprises Ltd (Real Estate)
Equity, Since 30 Jun 21 | 5329292% ₹89 Cr 862,251 Krishna Institute of Medical Sciences Ltd (Healthcare)
Equity, Since 31 Dec 23 | 5433082% ₹87 Cr 1,330,824
↑ 50,000 Cholamandalam Financial Holdings Ltd (Financial Services)
Equity, Since 31 Dec 18 | CHOLAHLDNG2% ₹86 Cr 459,599 Tega Industries Ltd (Industrials)
Equity, Since 31 Dec 21 | 5434132% ₹83 Cr 612,219
Thus, in a nutshell, it can be said that both the schemes differ on account of various parameters. As a consequence, individuals should be careful while investing in any of the schemes. They should understand the modalities of the scheme completely before investing. They should also check whether the scheme is in-line with their investment objective. This will help them to attain their objectives on time and in a hassle-free manner.
good article