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Stock Analysis, IPO, Mutual Funds, Bonds & More

Mirae Asset Large Cap Fund: Fund review

Focus on returns, cash flow pays off.

, ET Bureau|
Updated: Sep 04, 2019, 10.05 AM IST
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There are certain clear signs of an economic slowdown, though its severity is arguable. But a key element almost completely missing in the market is a ray of hope — and retail investors will do well to look for it in large-sized companies. Large companies have the strength to weather demand fluctuations in the industry in which they undertake business.

In contrast, mid- and small-sized companies are more vulnerable to market shocks given the scale of their business and balance sheet. Hence, it makes great sense to be with those schemes which have a high exposure to large-sized companies. Among such schemes, Mirae Asset Large Cap is a solid performer. Almost 85 per cent of the scheme’s portfolio is invested in large-sized companies. In the past eleven years of its existence, the scheme has progressively performed better not just with respect to its benchmark index Nifty 100 TRI (total returns index) but also with respect to its peers. This is true in most market cycles.

Presently, the scheme’s fund managers — Neelesh Surana, Harshad Borawake, and Gaurav Misra — have carefully stuck to the fund house’s investment philosophy of investing in companies with high or stable return ratios and stable or rising cash flows from business. They have enhanced exposure to consumption-related ideas which include retail focused banks. In the past five-year and ten-year periods, the scheme has given 11.3 per cent and 15 per cent returns while its peers have given average returns of 7 per cent and 9.9 per cent, respectively.

Portfolio change (Past 6 months)
New entrants Complete exits Increase in allocation
Indian Energy Exchange Bharat Financial Inclusion Asian Paints
Max Financial Services
Torrent Pharmaceuticals

Returns (in %)
Period CAGR Return SIP CAGR Return Diversified Largecap AVG CAGR
1 Year -3.44 -1.60 -5.74
3 Year 10.31 6.62 6.19
5 Year 11.58 10.27 7.79

Returns peer comparison (in %)
Scheme name 1-year 3-year 5-year
Edelweiss Large Cap Fund -7.23 7.85 9.03
ICICI Prudential Bluechip Fund -6.94 7.71 8.71
JM Core 11 Fund -8.92 6.20 10.02
Source: Accord Fimtech; Compiled by ETIG Database

Expert take
Harshvardhan Roongta, CFP Roongta Securities
Mirae has emerged as one of the top fund managers with most of its schemes outperforming the benchmark and its peers. This scheme was a multi cap scheme before being categorised as a large cap fund. It has maintained its outperformance post reclassification. Investors wanting a large cap portfolio with some quality mid caps can invest in this scheme.
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