While evaluating the overall performance of a mutual fund scheme, it is vital to compare the past few years' returns vis-à-vis the returns posted by its benchmark index. Here we give a lowdown on the value funds and their returns in the past three returns. At the outset, we explain here what exactly do value funds imply.
Value funds essentially invest in undervalued companies from a long term perspective until these companies unlock their growth potential
Beating the benchmark index returns is not easy when they are as high as 18.81 percent or 19.23 percent. However, five mutual funds managed to beat them. As we can see in the table below, UTI Value Opportunities Fund gave a return of 19.09 percent, L&T India Value Fund delivered a return of 19.55 percent, Nippon India Value Fund gave 20.73 percent, ICICI Prudential Value Discovery Fund 25.33 and IDFC Sterling Value gave a compound annual growth rate (CAGR) of 25.90 percent in the past three years.
Value funds | 3-year-returns | Benchmark index (%) |
UTI Value Opportunities Fund | 19.09 | 18.81* |
L&T India Value Fund | 19.55 | 19.23** |
Nippon India Value Fund | 20.73 | 18.81 |
ICICI Prudential Value Discovery Fund | 25.33 | 18.81 |
IDFC Sterling Value Fund | 25.90 | 19.23 |
(Source: AMFI; Regular returns as on Nov 15)
(*NIFTY 500 Total Return Index, **S&P BSE 500 Total Return Index)
Out of these schemes, four schemes managed to beat the benchmark index returns in the past five years barring IDFC Sterling Value Fund.
Value funds | 5-year-returns | Benchmark index (%) |
UTI Value Opportunities Fund | 13.19 | 13.12* |
L&T India Value Fund | 10.61 | 13.40** |
Nippon India Value Fund | 12.41 | 13.12 |
ICICI Prudential Value Discovery Fund | 14.65 | 13.12 |
IDFC Sterling Value Fund | 11.62 | 13.40 |
The returns given by value funds in the past five years were lower than that posted in the past three years, but they were also in the double digits. Highest among these schemes was UTI Value Opportunities Fund that gave a return of 13.19 percent, whereas the lowest by L&T India Value Fund at 10.61 percent.
Key details of high-performing value funds:
UTI Value Opportunities Fund: It was launched on July 20, 2005. It has given a CAGR of 14.22 percent since inception. This means if someone had invested ₹10,000 at the time of launch, the fund scheme would have grown to ₹99,665 by Oct 31, 2022.
Minimum investment in the scheme is ₹5,000 and monthly average AUM stood at ₹6,859 crore.
Its key stock constituents are HDFC Bank, ICICI Bank, Infosys, Axis Bank,, Bharti Airtel, SBI, ITC, Aditya Birla Fashion & Retail and NCA.
L&T India Value Fund: The fund was launched on January 8, 2010. Minimum application amount is ₹5,000. Its total month-end AUM is ₹8,013 crore.
The scheme (regular plan- growth) has given a return of 14.98 percent since inception. This means if someone had invested ₹10,000 at that time, it would have grown to ₹59,883 by now.
Top constituent stocks are ICICI Bank, SBI, The Federal Bank, HDFC Bank Axis Bank, Indian Bank, Kaurur Vysya Bank and Canara Bank.