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Fincash » Tata India Tax Savings Fund Vs L&T Tax Advantage Fund

Tata India Tax Savings Fund Vs L&T Tax Advantage Fund

Updated on March 21, 2019 , 72 views

There are a number of differences between Tata India Tax Savings Fund and L&T Tax Advantage Fund. These differences are present in spite of both the schemes being part of ELSS category of Equity Funds. ELSS or Equity Linked Savings Schemes are the Mutual Fund schemes that invest a predominant stake of their corpus in equity and equity-related instruments of various companies. By Investing in ELSS, individuals can enjoy dual benefits of investment as well as tax deductions. By investing in ELSS, individuals can claim up to INR 1,50,000 as a tax deduction under Section 80C of Income Tax Act, 1961. Being a Tax Saving Investment avenue, ELSS has a lock-in period of up to 3 years. So, let us understand the differences between Tata India Tax Savings Fund and L&T Tax Advantage Fund through this article.

Tata India Tax Savings Fund

Tata India Tax Savings Fund is a part of Tata Mutual Fund and was launched in the year 2006. The objective of this scheme is to always emphasize the importance of long-term capital appreciation along with income distribution in medium to long-term. Some of the key attributes of Tata India Tax Savings Fund are tax-free growth potential of the savings and take advantage of a portfolio of fundamentally good stocks. These stocks are selected using a top-down and bottom-up approach. Mr. Rupesh Patel is the sole fund manager managing Tata India Tax Savings Fund. Based on the Asset Allocation of the scheme, it invests around 80-100% of its accumulated fund money in equity and equity-related instruments while the remaining in fixed income and money market instruments. Tata India Tax Savings Fund uses S&P BSE Sensex TRI as its benchmark to construct its portfolio.

L&T Tax Advantage Fund

L&T Tax Advantage Fund is an open-ended ELSS scheme managed by L&T Tax Advantage Fund. This scheme was launched on February 27, 2006, and its objective is to invest its fund money primarily in diversified equity and equity-related securities and generate long-term capital growth through it. L&T Tax Advantage Fund uses S&P BSE 200 TRI Index as a base to build its portfolio. Some of the benefits of L&T Tax Advantage Fund is 360-degree approach and greater diversification of risk control. In normal circumstances, L&T Tax Advantage Fund invests around 95% of its corpus in equity and equity-related instruments while the remaining in money market and fixed income securities. Mr. S. N. Lahiri is the sole fund manager of L&T Tax Advantage Fund.

Tata India Tax Savings Fund Vs L&T Tax Advantage Fund

Though Tata India Tax Savings Fund and L&T Tax Advantage Fund belong to the same category of equity funds, nevertheless; there are numerous differences between them. So, let us understand these differences between them that are classified into four sections, namely, basics section, performance section, yearly performance section, and other details section.

Basics Section

Being the first section in the comparison, it analyses parameters such as Current NAV, scheme category, and Fincash Rating. With respect to Fincash Rating, it can be said that Tata India Tax Savings Fund is rated as 5-Star and L&T Tax Advantage Fund is rated as 4-Star. The current NAV of both the schemes shows a significant difference between them. As on April 26, 2018, the NAV of Tata India Tax Savings Fund was approximately INR 17 and of L&T Tax Advantage Fund was approximately INR 56. With respect to scheme category, it can be said that both the schemes belong to the category of Equity ELSS. The table given below shows the summary comparison 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
Tata India Tax Savings Fund
Growth
Fund Details
₹17.9189 ↓ -0.05   (-0.30 %)
₹1,598 on 28 Feb 19
13 Oct 14
Equity
ELSS
1
Moderately High
2.61
-0.38
-0.08
-10.52
Not Available
NIL
L&T Tax Advantage Fund
Growth
Fund Details
₹52.739 ↓ -0.28   (-0.52 %)
₹3,074 on 28 Feb 19
27 Feb 06
Equity
ELSS
7
Moderately High
2.61
-1.02
-0.35
-12.9
Not Available
NIL

Performance Section

It is the second section in the comparison of the schemes. This section compares the Compounded Annual Growth Rate or CAGR returns of both the schemes at different time intervals. Some of these intervals include 3 Month Return, 6 Month Return, 1 Year Return, and 5 Year Return. The comparison of CAGR returns reveals that in many instances, L&T Tax Advantage Fund leads the race. The summary comparison of the performance section is tabulated as follows.

Parameters
Performance1 Month
3 Month
6 Month
1 Year
3 Year
5 Year
Since launch
Tata India Tax Savings Fund
Growth
Fund Details
7.2%
6.4%
5.9%
6.7%
15.7%
0%
14%
L&T Tax Advantage Fund
Growth
Fund Details
6.5%
0%
-3.9%
-2.2%
13.9%
15.5%
13.6%

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Yearly Performance Section

Being the third section, it analyzes the difference in the absolute returns generated by both the schemes for a particular year. The comparison of absolute returns shows that for certain years Tata India Tax Savings Fund leads the race while in others L&T Tax Advantage Fund leads the race. The table given below shows the summarized comparison of the absolute returns.

Parameters
Yearly Performance2018
2017
2016
2015
2014
Tata India Tax Savings Fund
Growth
Fund Details
-8.4%
46%
2.1%
13.3%
0%
L&T Tax Advantage Fund
Growth
Fund Details
-8.1%
42.3%
8.1%
2.9%
44.8%

Other Details Section

The parameters that form part of this last section include AUM, minimum SIP investment, and minimum lumpsum investment. With respect to the minimum SIP and lumpsum investment, it can be said that the amount is same for both the schemes, that is, INR 500. However, there is a difference in the AUM of both the schemes. For Tata India Tax Savings Fund, the AUM is approximately INR 1,267 Crores and for L&T Tax Advantage Fund is approximately INR 3,016 Crores as on March 31, 2018. The performance of other details section is tabulated as follows.

Parameters
Other DetailsMin SIP Investment
Min Investment
Fund Manager
Tata India Tax Savings Fund
Growth
Fund Details
₹500
₹500
Rupesh Patel - 3.84 Yr.
L&T Tax Advantage Fund
Growth
Fund Details
₹500
₹500
S.N. Lahiri - 6.19 Yr.

Growth of 10k Investments over the years

Growth of 10,000 investment over the years.
Tata India Tax Savings Fund
Growth
Fund Details
DateValue
28 Feb 15₹11,512
29 Feb 16₹10,087
28 Feb 17₹13,589
28 Feb 18₹16,880
28 Feb 19₹16,099
Growth of 10,000 investment over the years.
L&T Tax Advantage Fund
Growth
Fund Details
DateValue
28 Feb 14₹10,000
28 Feb 15₹15,441
29 Feb 16₹13,112
28 Feb 17₹18,155
28 Feb 18₹22,828
28 Feb 19₹20,252

Detailed portfolio Comparison

Asset Allocation
Tata India Tax Savings Fund
Growth
Fund Details
Asset ClassValue
Cash2.24%
Equity97.81%
Equity Sector Allocation
SectorValue
Financial Services40.47%
Consumer Cyclical13.63%
Consumer Defensive10.96%
Technology10.82%
Industrials9.37%
Health Care4.93%
Energy3.85%
Basic Materials3.16%
Real Estate0.62%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
ICICI Bank Ltd (Financial Services)
Equity, Since 30 Nov 16 | ICICIBANK
9%₹141 Cr4,015,000
Infosys Ltd (Technology)
Equity, Since 30 Sep 18 | INFY
8%₹123 Cr1,680,000
↑ 660,000
HDFC Bank Ltd (Financial Services)
Equity, Since 28 Feb 10 | HDFCBANK
7%₹116 Cr560,000
Axis Bank Ltd (Financial Services)
Equity, Since 31 Aug 18 | 532215
7%₹106 Cr1,500,000
State Bank of India (Financial Services)
Equity, Since 30 Nov 18 | SBIN
5%₹83 Cr3,100,000
Reliance Industries Ltd (Energy)
Equity, Since 31 Jan 18 | RELIANCE
4%₹62 Cr500,000
Kotak Mahindra Bank Ltd (Financial Services)
Equity, Since 31 May 15 | KOTAKBANK
4%₹60 Cr495,000
Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 30 Jun 17 | HDFC
4%₹57 Cr310,000
ITC Ltd (Consumer Defensive)
Equity, Since 30 Sep 16 | ITC
3%₹52 Cr1,900,000
Tata Consultancy Services Ltd (Technology)
Equity, Since 31 Jul 18 | TCS
3%₹50 Cr250,000
Asset Allocation
L&T Tax Advantage Fund
Growth
Fund Details
Asset ClassValue
Cash5.65%
Equity94.73%
Equity Sector Allocation
SectorValue
Financial Services29.24%
Technology13.84%
Industrials11.8%
Basic Materials11.58%
Consumer Cyclical10.34%
Health Care7.26%
Energy4.71%
Consumer Defensive2.66%
Communication Services1.72%
Utility1.06%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
HDFC Bank Ltd (Financial Services)
Equity, Since 31 Mar 06 | HDFCBANK
6%₹186 Cr897,300
↑ 119,600
(A) Tri Party Repo Dealing System (Treps)
CBLO/Reverse Repo | -
6%₹174 Cr
ICICI Bank Ltd (Financial Services)
Equity, Since 30 Jun 09 | ICICIBANK
5%₹163 Cr4,658,200
Tata Consultancy Services Ltd (Technology)
Equity, Since 30 Jun 09 | TCS
4%₹122 Cr615,500
Reliance Industries Ltd (Energy)
Equity, Since 31 Aug 18 | RELIANCE
4%₹121 Cr980,200
↑ 241,200
Housing Development Finance Corp Ltd (Financial Services)
Equity, Since 31 May 17 | HDFC
4%₹119 Cr649,000
Infosys Ltd (Technology)
Equity, Since 31 Mar 06 | INFY
3%₹104 Cr1,416,000
↑ 61,000
Future Retail Ltd (Consumer Cyclical)
Equity, Since 31 Aug 16 | FRETAIL
3%₹101 Cr2,386,000
↑ 500,000
Larsen & Toubro Ltd (Industrials)
Equity, Since 31 Mar 06 | LT
3%₹97 Cr753,000
Axis Bank Ltd (Financial Services)
Equity, Since 31 May 17 | 532215
3%₹92 Cr1,293,000
↑ 65,000

Therefore, it can be said that both the schemes differ on account of numerous parameters. As a consequence, individuals should be very careful before investing in any of the schemes. They should analyze whether the scheme in which they are planning to invest matches their investment objective or not. They should also understand the scheme’s modalities completely. This will help them to attain their objectives 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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