Largest Mutual Fund Schemes: Infrastructure Steals Spotlight

More than 15 schemes out of the mutual fund houses' top 30 schemes are in the sectoral and thematic category. The record high inflows into the category over the past few months accounts for this category having the highest assets under management in the industry.

While the spotlight undeniably belongs to the sectoral funds, mid-caps and small caps have also held their place in the list.

This category has also managed decent returns during the period under review. The average AUM of small-cap funds is Rs 30,575 crore, and the average AUM of mid-cap funds is Rs 36,938 crore.

With over Rs 10 crore AUM, spread of schemes holding their place on top is across various categories. The scheme with the largest AUM is one of the fund house's flagship schemes, SBI Contra Fund, with its AUM standing at Rs 39,433 crore.

The scheme with a solid 45.2% returns over one year is closely followed by the second scheme with the largest AUM. This scheme has done tremendously well for the investors, according to Mohit Gang, co-founder of MoneyFront.

SBI Long Term Advantage Fund, under the ELSS category, has returned 41.7% over a year and has Rs 243 crore under the scheme. This mid-cap heavy scheme has been a good choice for long-term investors.

The SBI Healthcare Opportunities Fund is the only thematic scheme in the bundle with Rs 3,203 crore AUM. The scheme had annualised returns of 52.6%.

"Recent performance is weighed in and the past five-year performance has pulled up the numbers," said Gang.

With thematic funds holding all the three places in the fund house's largest schemes, the five-year returns on these have not gone below 30%. The AUM of ICICI Pru Pharma Healthcare & Diagnostics Fund, the largest scheme, stands at Rs 4,808 crore and gives an annualised five-year return of 32.1%.

The ICICI Prudential Infrastructure Fund stands a close second with 61% annualised returns over a year as well. The fund house's technology fund has also got an AUM of Rs 14,212 crore, with a 38% annualised returns.

"The rally in tech had only begun eight–nine months back, when it was certain that the Fed is going for a rate reversal. This sector is highly geared toward rate-cycle reversing," said Gang.

The change in cycle is the risk of timing the market correctly is an issue investors in sectoral and thematic funds are bound to face, according to Gang.

The AUM of the fund house's largest scheme, HDFC Mid-Cap Opportunities Fund, stands at Rs 75,296 crore with a 29% annualised five-year returns. The small cap and infrastructure funds also have an annualised return of over 25% over five years.

"It's a similar story across the fund houses," said Gang. The small and mid-caps have come among the top five schemes of the fund house.

The myth that only schemes with smaller-sized AUM will perform well needs to make way for these mid and small-cap schemes. "The fund manager has pulled off these returns with AUM that size, hats off," said Gang.

The largest small-cap fund being managed in India belongs to this fund house. The AUM of Nippon India Small Cap Fund stands at Rs 61,000 crore and the scheme has returned 51% in a one-year time frame.

There are a lot of factors that contribute to delivery of returns of this kind. The small caps have doubled and the wide coverage of stocks under the benchmark have also brought them significant gains.

"Most of small and mid-cap funds, barring one or two, have underperformed. This tells that the broader markets have performed incredibly well, and the rising tide has lifted all the boats," said Gang.

Taking the first place here is, the small cap fund with 46.2% annualised returns over a year. The Kotak Infra & Eco Reform Fund, under the sectoral and thematic category has also gained an annualised return of 57.8%.

"Participation in mid and small cap has been similar across the board, mirroring returns across fund houses. Kotak had lost a few fund managers, but they continue to be an institutionalised house who has stuck to their guns fairly well," said Gang.

It takes the first spot with Rs 1,168 crore AUM and the highlight is their transportation and logistics fund.

The UTI Transportation & Logistics Fund has 57.4% annualised returns over one year with AUM of Rs 3,843 crore. Gang gives this fund the "right-timing, right-place" label as they were one of the only fund houses to offer schemes in this space.

This fund house has its small and mid-cap funds that rank first with over 25% annualised returns over a five-year period. The overall fund house performance has not been at par with the other because they have chosen to stick to their policy of quality even when momentum-driven value picked up in the market.

"My sense is, quality is something that is showing green shoots now, in the three to four months," said Gang.

The fund house has been true to their philosophy, continuing to believe that their cycle will come.

With three thematic funds in focus, the Digital India fund ranks first with AUM of Rs 5,311 crore. The infra fund has also given an annulaised return of 50.4% over a one-year period.

The Dividend Yield Fund is one of the oldest in the space and the fund house has always focused on value, according to Gang.

These value-themed funds have benefitted from various holdings over the last year and a half.

The fund has two thematic funds and their mid-cap fund in their largest schemes list. With over 40% annualised returns over a year on all three, the relatively lower AUM does not seem to hold back the performance.

"This is an equity-heavy fund house whose primary focus is on quality. This is where they have lacked among their peers. But the healthcare cycle has picked up and their mid-cap scheme also stands out from the pack," said Gang.

The thematic fund of like healthcare is followed by the small-cap fund in this fund house's largest scheme list.

With 93 stocks, the DSP India Tiger Fund takes the spotlight. This broad-based scheme that covers economic growth and development. This wide scope has pushed the scheme to bring the best returns on the list.

"I totally adore the fund and the fund manager, Charanjit Singh. He is terrific in the way he manages the scheme," said Gang.

With the average AUM across all the funds standing at Rs 16,608 crore, the growth in AUM is remarkable. While stable schemes like flexi cap and large cap are missing from the list, the traction towards themes are clear in the inflow.