Table of Contents
L&T Tax Advantage Fund Vs SBI Magnum Tax Gain Fund
L&T Tax Advantage Fund and SBI Magnum Tax Gain Fund both the schemes differ on a number of parameters. These differences exist, even though both the schemes are a part of the same category, that is, Equity ELSS. Equity Linked Savings Scheme (ELSS) are also known as tax saving Mutual Fund. These schemes offer individuals dual benefits of investing and tax deductions. Individuals Investing in ELSS schemes can claim a tax deduction of up to INR 1,50,000 under Section 80C of Income Tax Act, 1961. However, these schemes have a lock-in period of three years which again is the shortest as compared to the other tax saving avenues. Though there are a number of schemes offered under one category, nevertheless; there are differences between them. So, let’s understand the differences between L&T Tax Advantage Fund and SBI Magnum Tax Gain Fund.
L&T Tax Advantage Fund
L&T Tax Advantage Fund’s investment objective is to attain long-term capital appreciation from a portfolio predominantly consisting of equity and equity-related securities. This open-ended tax savings Mutual Fund scheme was incepted on February 27, 2006. L&T Tax Advantage Fund uses S&P BSE 200 TRI Index as its benchmark index and is managed solely by Mr. S. N. Lahiri. In normal situations, L&T Tax Advantage Fund invests around 95% of its accumulated pooled money in equity and equity-related instruments and the remaining in money market instruments. As on March 31, 2018, HDFC Bank Limited, IndusInd Bank Limited, Larsen & Toubro Limited, and Godrej Properties Limited were some of the holdings of L&T Tax Advantage Fund’s portfolio. Greater diversification for risk control and 360-degree research are some of the benefits of L&T Tax Advantage Fund.
SBI Magnum Tax Gain Fund
SBI Magnum Tax Gain Fund is an apt choice for investors seeking dual advantage of tax savings along with exposure in the equity markets. This scheme of SBI Mutual Fund aims to deliver investment benefits to its investors along with offering tax deductions. The scheme uses S&P BSE 100 Index as its benchmark to construct its basket of assets. Mr. Dinesh Balachandran is the fund manager managing SBI Magnum Tax Gain Fund. Based on the Asset Allocation objective, SBI Magnum Tax Gain Fund invests around 80-100% of its fund money in equity and equity-related instruments while the remaining portion in money market instruments. ICICI Bank Limited, Reliance Industries Limited, and Rural Electrification Corporation Limited are some of the holdings of SBI Magnum Tax Gain Fund’s portfolio as on March 31, 2018.
L&T Tax Advantage Fund Vs SBI Magnum Tax Gain Fund
L&T Tax Advantage Fund and SBI Magnum Tax Gain Fund both the schemes differ on a number of parameters. So, let us understand the differences between both the schemes by comparing these parameters that are classified into four sections, namely, basics section, performance section, yearly performance section, and other details section.
Basics Section
It is the first section in the comparison of the schemes. The parameters of the basics section include scheme category, Fincash Rating, and Current NAV. With respect to scheme category, it can be said that both the schemes are a part of Equity ELSS category. The comparison of Fincash Rating states that L&T Tax Advantage Fund is a 4-Star rated scheme and SBI Magnum Tax Gain Fund is a 2-Star rated scheme. The comparison of NAV also states that both the schemes differ significantly. As on May 02, 2018, the NAV of L&T Tax Advantage Fund was approximately INR 57 and of SBI Magnum Tax Gain Fund was around 142. The summary of this section is tabulated as follows.
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 Tax Advantage Fund
Growth
Fund Details ₹56.754 ↓ -0.28 (-0.49 %) ₹3,382 on 31 Dec 19 27 Feb 06 ☆☆☆☆ Equity ELSS 7 Moderately High 2.21 0.15 -0.82 -6.06 Not Available NIL SBI Magnum Tax Gain Fund
Growth
Fund Details ₹148.235 ↓ -0.88 (-0.59 %) ₹7,370 on 31 Dec 19 7 May 07 ☆☆ Equity ELSS 31 Moderately High 2.22 0.11 -1.8 -4.59 Not Available NIL
Performance Section
Being the second section in the comparison, the parameter forming part of this section is CAGR or Compounded Annual Growth Rate returns. The comparison of performance section states that in most of the instances, L&T Tax Advantage Fund has performed better as compared to L&T Tax Advantage Fund. The table given below summarizes the comparison of the performance section.
Parameters Performance 1 Month 3 Month 6 Month 1 Year 3 Year 5 Year Since launch L&T Tax Advantage Fund
Growth
Fund Details 2.3% 6.8% 10% 13.2% 9.5% 8% 13.3% SBI Magnum Tax Gain Fund
Growth
Fund Details 3.4% 6.7% 7.7% 10.5% 7.6% 5% 9.8%
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Yearly Performance Section
The comparison of absolute returns generated by both the schemes for a particular year is done in this section. Analysis of absolute returns reveals that in certain years, L&T Tax Advantage Fund leads the race. On the other hand, in certain years, SBI Magnum Tax Gain Fund leads the race. The summary comparison of the yearly performance section is tabulated as follows.
Parameters Yearly Performance 2018 2017 2016 2015 2014 L&T Tax Advantage Fund
Growth
Fund Details 4.6% -8.1% 42.3% 8.1% 2.9% SBI Magnum Tax Gain Fund
Growth
Fund Details 4% -8.3% 33% 2.1% 3.2%
Other Details Section
It is the last section in the comparison of the schemes. It includes parameters such as AUM, minimum SIP and lumpsum investment, and exit load. The minimum SIP and lumpsum investment for both the schemes are same, that is, INR 500. However, both the schemes differ considerably on account of AUM. The AUM of SBI Magnum Tax Gain Fund was around INR 6,067 Crores while of L&T Tax Advantage Fund was approximately INR 3,016 Crores as of March 31, 2018. In addition, both the schemes do not have any exit load as they belong to the category of equity ELSS. The comparison summary of this section is as shown in the table given below.
Parameters Other Details Min SIP Investment Min Investment Fund Manager L&T Tax Advantage Fund
Growth
Fund Details ₹500 ₹500 S.N. Lahiri - 7.02 Yr. SBI Magnum Tax Gain Fund
Growth
Fund Details ₹500 ₹500 Dinesh Balachandran - 3.22 Yr.
Growth of 10k Investments over the years
L&T Tax Advantage Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,290 31 Dec 16 ₹11,127 31 Dec 17 ₹15,830 31 Dec 18 ₹14,551 31 Dec 19 ₹15,227 SBI Magnum Tax Gain Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 31 Dec 14 ₹10,000 31 Dec 15 ₹10,320 31 Dec 16 ₹10,537 31 Dec 17 ₹14,016 31 Dec 18 ₹12,847 31 Dec 19 ₹13,361
Detailed portfolio Comparison
L&T Tax Advantage Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 2.17% Equity 98.43% Equity Sector Allocation
Sector Value Financial Services 36.52% Technology 11.33% Basic Materials 11.1% Health Care 9.37% Consumer Cyclical 8.75% Industrials 8.06% Energy 4.6% Consumer Defensive 3.93% Communication Services 3.61% Utility 0.61% Top Securities Holdings / Portfolio
Name Holding Value Quantity ICICI Bank Ltd (Financial Services)
Equity, Since 30 Jun 09 | ICICIBANK8% ₹256 Cr 4,984,600 HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 06 | HDFCBANK7% ₹223 Cr 1,751,800 Tata Consultancy Services Ltd (Technology)
Equity, Since 30 Jun 09 | TCS5% ₹153 Cr 747,000 Reliance Industries Ltd (Energy)
Equity, Since 31 Aug 18 | RELIANCE4% ₹132 Cr 853,000 Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 30 Apr 15 | KOTAKBANK4% ₹124 Cr 765,100 Larsen & Toubro Ltd (Industrials)
Equity, Since 31 Mar 06 | LT3% ₹113 Cr 853,000 HCL Technologies Ltd (Technology)
Equity, Since 30 Sep 17 | HCLTECH3% ₹99 Cr 879,200
↓ -20,500 Bharti Airtel Ltd (Communication Services)
Equity, Since 31 Oct 17 | BHARTIARTL3% ₹98 Cr 2,214,200
↓ -487,611 Infosys Ltd (Technology)
Equity, Since 31 Mar 06 | INFY3% ₹95 Cr 1,370,200 (A) Tri Party Repo Dealing System (Treps)
CBLO/Reverse Repo | -3% ₹93 Cr SBI Magnum Tax Gain Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 5.06% Equity 94.94% Equity Sector Allocation
Sector Value Financial Services 35.69% Industrials 11.7% Basic Materials 8.88% Technology 7.72% Consumer Defensive 6.5% Consumer Cyclical 6.23% Utility 5.81% Health Care 5.53% Energy 5.14% Communication Services 3.53% Top Securities Holdings / Portfolio
Name Holding Value Quantity HDFC Bank Ltd (Financial Services)
Equity, Since 30 Jun 07 | HDFCBANK6% ₹441 Cr 3,466,730 Axis Bank Ltd (Financial Services)
Equity, Since 30 Sep 11 | 5322156% ₹411 Cr 5,454,199 ICICI Prudential Life Insurance Co Ltd (Financial Services)
Equity, Since 30 Sep 16 | 5401334% ₹321 Cr 6,654,842 ICICI Bank Ltd (Financial Services)
Equity, Since 31 Jan 17 | ICICIBANK4% ₹313 Cr 5,812,042 Larsen & Toubro Ltd (Industrials)
Equity, Since 28 Feb 07 | LT4% ₹309 Cr 2,383,981 State Bank of India (Financial Services)
Equity, Since 31 May 06 | SBIN4% ₹302 Cr 9,050,233
↑ 587,867 Infosys Ltd (Technology)
Equity, Since 31 Mar 18 | INFY4% ₹290 Cr 3,970,000 Treps
CBLO/Reverse Repo | -4% ₹279 Cr Reliance Industries Ltd (Energy)
Equity, Since 30 Apr 06 | RELIANCE4% ₹268 Cr 1,770,000 ITC Ltd (Consumer Defensive)
Equity, Since 29 Feb 12 | ITC3% ₹220 Cr 9,255,864
Therefore, based on the above pointers, it can be concluded that both the schemes differ on a number of parameters. As a consequence, individuals should be careful while choosing any of the schemes for investment. They should verify whether the scheme matches their investment objective or not. Also, individuals must understand the functioning of the scheme completely. This will help them to attain their objectives on time along with ensuring the safety of their investment.
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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