12,080.85-45.05
Stock Analysis, IPO, Mutual Funds, Bonds & More

Kotak Emerging Equity Fund: Fund Review

Kotak Emerging Equity has given 11.1% and 10.4% returns respectively in the past three-year and five-year periods, while its peers in the mid cap category have given average returns of 8.8% and 8% in the same period.

, ET Bureau|
Last Updated: Jan 07, 2020, 09.47 AM IST
0Comments
iStock
iStock-1126662676
Tax Calculator
High dependence on the top ten companies by weightage in the index has made these companies expensive. This is one of the key reasons why the benchmark index is trading at a premium to its three-year average valuation. For instance, the Sensex is trading at 6% premium to its three-year average price-to-earnings multiple.

On the other hand, a view that is gaining acceptance among savvy fund managers is that the rally in the markets may shift to small- and-mid-sized companies.

There is a convincing reason for this as the BSE Midcap Index is trading at a 13% discount to its past three-year average price-to-earnings multiple. In fact, in the past two weeks, the BSE Sensex has been flat to close at 41464. In the same period, the BSE Midcap Index has gained nearly 2% to close at 15114. This shows that the interest in the mid-sized companies is increasing gradually as well-placed large-sized peers are trading at expensive valuations.

Given these factors, it makes sense to be invested in schemes which have a high focus on midcaps. One such scheme is Kotak Emerging Equity. In the past three-year and five-year periods, it has given 11.1% and 10.4% returns, respectively, while its peers in the category have given average returns of 8.8% and 8%. This scheme is recommended for those investors who believe in the philosophy that high risk generates high returns over long term.

Portfolio change (past six months)
New entrants Complete exits Increase in allocation
Axis Bank Abott India Max Financial Services
Balkrishna Industries Bharat Financial Inclusion Page Industries
Cummins India State Bank of India

Returns (in %)
Period CAGR return SIP CAGR return Marketcap midcap
Average CAGR
1 year 11.29 19.20 4.66
3 year 10.64 6.60 9.05
5 year 10.46 10.02 7.64
Source: Accord Fintech; compiled by ETIG Database


Expert Take
HARSHVARDHAN ROONGTA, CFP, Roongta Securities

The scheme has consistently beaten its benchmark comfortably over all time horizons. It has generated higher returns than the category average throughout. Fund manager Pankaj Tibrewal has been managing this scheme since 2010. He has built a well-diversified portfolio comprising 70 companies across different sectors, which shows he is focussed on investing in growth ideas across sectors and avoiding concentration risks. Investors looking for a portfolio with quality midcap companies can invest in this scheme through the systematic investment plan (SIP) for a time horizon of at least five years.
Click here for all the information and analysis you need for tax-saving this financial year

Also Read

Kotak Emerging Equity Fund: Fund Review

Kotak Emerging Equity Fund: Fund review

Kotak Emerging Equity Fund: Fund review

Kotak Emerging Equity Fund: Fund review

Comments
Add Your Comments
Commenting feature is disabled in your country/region.

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service