HDFC Tax Saver Growth Plan – Latest Nav, Portfolio Performance

Today we are going to elaborate on the fund Hdfc tax saver growth plan. Please remember all the fund parameters we are going to discuss here are based on 27th March 2017 data as reference and we only review regular and growth plans of mutual funds in this article. We are going to review the fund name as HDFC tax saver which is an ELSS fund launched in 1996.

Before going into the review let us understand about funds objectives the fund invests primarily in equities and equity-related instruments and is an ideal fund for long term capital appreciation. It is a large-cap oriented fund it enables investors to avail tax deduction from total income as permitted under Section 80 C of Income Tax Act.

Now let’s start the detailed review on each parameter.first the fund belongs to the HDFC mutual fund family which is currently India’s second-biggest fund house in terms of assets under management. out of more than 45 funds and was established in the year 2000. So for being a pretty large and experienced fund house, we give a green star here. HDFC tax saver fund was launched in March 1996 .which at that time was part of the Zurich India mutual fund and was merged with as HDFC in 2003.

CURRENT NAV Plans And Option

Plan Name NAV Date NAV Amount 
HDFC Tax Saver – Direct Plan-Growth Option 25 Nov 2019 541.3280
HDFC TaxSaver – Growth 25 Nov 2019 518.5600
HDFC Tax Saver – Direct Plan – Dividend 25 Nov 2019 56.5710
HDFC TaxSaver – Dividend 25 Nov 2019 53.1620

Chart credit to –

This means it is active for more than 20 years in fact it is among the five oldest tax saving funds in India. So let’s give a green star here to for being a very experienced fund. Which has seen all market ups and point is categorized in ELSS category as it gives section ATC tax deductions for investing and has a three-year locking. Moving to next to this point has an asset under management of rupees five thousand eight hundred crores and ranks third-biggest ELSS one among a population of around 40.

So this high asset under management shows investors trust in the fund’s management and its performance so HDFC Tax Saver definitely deserves a green star on this parameter.  Now let’s talk about the moolah how are the returns we will first talk about the trailing returns from 27th March date and then talk about the calendar returns in trailing returns. We can see the fund has consistently beaten its benchmark index that is nifty 500 across all 1 3 5 and 10 years.

But has been behind the category average returns consistently in long term 3,5 and 10 years so trailing return performance of the fund clearly seems to be behind the line. Now looking at the calendar ice returns of the last 10 years from 2007 to 2016. Which means returns from 1st Jan to 31st December of a calendar year we see that there have been three instances when the fund was beaten by both benchmark and category average.

That is in 2007 2012 and 2015 and fund has performed dismally in 2007 and 2015 is far from benchmark returns. but all is not that bad they had pretty good performance in the year 2009-2010 2014 and 2016. Where they have beaten both benchmark and category average returns back good margin even in bad markets of 2008 and 2011 fund could manage the fall better than the benchmark and category average.

In 2013 HDFC Tax Saver has given near category average returns so now looking at this overall fund calendar year performance isn’t bad as they have beaten both benchmark and category average six out of ten times and have performed better than others in the market Falls as well. So clearly they had some good years but some very bad years to such as 2007 and 15 which may have pulled their overall returns down. So due to this pretty performance where the fund has performed badly in a few years and good in a few other years we give this fund to yellow stars on these parameters.

The next important parameter is fund manager when a quick early lead this fund for more than 10 years now he took the leadership in November 2006 winner is a BTech from IIT Bombay and MBA from IIM Bangalore and has been part of fund house since 2006 as well.

When it also leads three other equity-oriented funds since 2006 LT FC code and satellite fund is multi-cap fun with 583 crores as under management and has given above benchmark. But below category average returns for last 10 years and same is the story with SD FC premier multi-cap fund which as the name suggests is also a multi-cap fund with 289 crores as rental management and HDFC equity savings fund which is an equity-oriented hybrid front with 620 crore asset under management.

So if we see all of Rene’s funds together we see the same story which is above benchmark returns but lower than category average returns. so even though the fund has an experienced and the stable fund manager his overall performance record is not too impressive and therefore this parameter deserves a yellow star too.


Top Stock Holdings Of The Fund And Funds Diversification

As of 27th March, one has 63 stocks in portfolio with top 5 contributing close to 28% current cash allocation is less than 2% and rest.  All is inequity fund has very good diversification in the portfolio and wait for the age of top 5 companies is a little less than our benchmark of 25% and hence we get this parameter a yellow star.

Sector Diversification in HDFC Tax Saver

Here the top three sectors contribute to more than 50% and the fund is definitely so we don’t financial sector and therefore we give this parameter yellow star . to next our expenses expense ratio of this fund is two point one six percent. which is lesser than the average expense ratio of this category that is around two point five percent and hence deserves a green star.

Now those who like numbers let us discuss few important ratios – standard deviation a measure of volatility and risk is higher than benchmark and category which means the fund takes higher risk compared to them.  beta 2 is a measure of risk and is also much higher than the categories and again shows a higher risk this fund is taking.

Alpha which measures a risk-adjusted return so 6 point 6 alpha means it can perform 6 points 6 percent better than the benchmark so unexpectedly even by taking a much higher risk it is showing alpha lesser than the category. So this means this fund has a higher risk and low return profiles which do not look good. Last is the P ratio of the portfolio which is 20 point 5 and is much lesser than the benchmark NSE 500 index P ratio of 27 points one and it shows its propensity to choose lower peace talks and also its large-cap buyers.

Which have lower P multiple so even with large gap bias funds higher risk profile than category and benchmark does not look good and over that it is generating lower alpha than the category which creates a case for red star on this parameter few other important info to note about the fund is that it is currently a large-cap focused fund and hence has 78% investment in large caps and rest in mid-cap and small-caps. And this table shows how the Pease 10,000 siP would have performed in various time frames and prove the decently good performance this fund has given continuously.

So if we calculate we got total of four green stars and five yellow stars and one red star with higher risk and lower return profile being the biggest concern . to summarize as HDFC tax saver is a higher-risk fund in the ELSS category even though its current focus is on large-cap oriented stocks. it is a large ELSS fund and must be very popular looking at it as rental management but in terms of performance, the fund has delivered a patchy return in the last 10 years.

Some of the years are pretty good and some very bad though it has consistently managed to stay ahead of benchmark sluggish returns with respect to category average is worrisome.  it’s lower P than the benchmark shows its tilt towards low peace talks in an expensive market which could be a risky strategy. It was a heavily Mid Cap tilted fund until 2012 but has taken an overweight position in large-cap stocks in the last few years.

HDFC Tax Saver Fund is managed by Benelli Kearney who is an experienced fund manager but his overall performance including other funds he manages is pretty average.  so overall fund returns are not too bad but the average performance of fund manager in the last few years and high risk and the low alpha portfolio doesn’t seem to be good news for the fund in a short time period.

So that is all on this one review if you have any questions regarding HDFC Tax Saver. please do write in the comment section below have a great time ahead.

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