These 7 ELSS Tax Saver MF schemes turned Rs 1 lakh investment into at least Rs 1,23,460 in 3 years; Quant, SBI, Bandhan funds on the list
Top ELSS tax saver mutual fund schemes: Did you know that ELSS mutual funds serve a dual purpose? Where on the one hand these schemes help investors to stay invested for at least three years, they also offer tax benefits under Section 80C of the Income Tax Act. Check out this list of the top seven ELSS tax saver MF schemes that have grown Rs 1 lakh into at least Rs 1.23 lakh in the three-year period and also provided tax benefits. It may leave you surprised.
ELSS tax saver mutual fund schemes: ELSS tax saver plans are a specific type of equity-linked mutual fund schemes that require each investment to be locked in for three years while offering tax benefits up to Rs 1.5 lakh in a financial year. Here's a list of seven such schemes that have delivered returns of at least 23.46 per cent in the three-year period.
Any guesses?
Quant ELSS Tax Saver Fund, SBI Long Term Equity Fund, HDFC ELSS Tax Saver Fund, Motilal Oswal ELSS Tax Saver Fund, Bank of India ELSS Tax Saver Fund, Franklin India ELSS Tax Saver Fund and Bandhan ELSS Tax Saver Fund, all benchmarked to the Nifty 500 Total Return or S&P BSE 500 Total Return gauges, are the seven schemes that have grown a one-investment of Rs 1 lakh made three years ago into at least Rs 1.23-1.33 lakh on April 18, 2024, according to data from MF industry body AMFI.
Let's put things into perspective
That essential means that a lump sum investment of Rs 60,000 in these schemes on April 16, 2021, would have turned into a corpus of Rs 74,076-79,596 on April 18, 2024, and a Rs 1,50,000 investment into Rs 1,85,190-1,98,990, according to AMFI data.
What are total return indices? Why are they used as benchmarks for mutual fund returns?
A total return index is a comprehensive measure that includes both capital appreciation and dividend income, which makes it a perfect yardstick for measuring the performance of mutual funds given their holistic approach in evaluating investment performance. By considering all sources of return, including price appreciation and dividends, total return indices provide a more accurate representation of an investment's overall profitability. In other words, Utilising total return indices as benchmarks ensures a thorough assessment of investment performance and aids in making informed financial decisions.
7. Bandhan ELSS Tax Saver Fund (direct mode)
As of April 18, 2024, the fund has 94.7 per cent allocation to equity, out of which, 62.4 per cent is in largecap stocks, and 8.8 per cent and 15 per cent in midcaps and smallcaps, respectively.
NAV: Rs 155.7 | Size: Rs 6,294 crore
6. Franklin India ELSS Tax Saver Fund (direct mode)
The fund has 98.3 per cent allocation to equity, out of which, 64.8 per cent is in largecaps, 11.7 per cent in midcaps and 7.2 per cent in smallcaps.
NAV: Rs 1,394.8 | Size: Rs 6,161 crore
5. Bank of India ELSS Tax Saver Fund (direct mode)
The fund has 94.5 per cent allocation to equity. It has 26.6 per cent holdings in the financial sector, 12.9 per cent in construction, and around 8-11 per cent to the energy, healthcare and metals & mining spaces. The scheme investds funds in 70 stocks, including PSU banks SBI, Canara Bank, Bank of Baroda, and private sector construction giant L&T.
NAV: Rs 175.4 | Size: Rs 1,244.5 crore
4. Motilal Oswal ELSS Tax Saver Fund (direct mode)
The fund has as much as 98 per cent allocation to equity with holdings concentrated in 29 stocks. Out of that 98 per cent, it has 17.4 per cent is dedicated to largecaps, 10.1 per cent to midcaps and 33.4 per cent to smallcaps. Among the 21 stocks stocks, Zomato holds the maximum weight, at 7.39 per cent.
NAV: Rs 47.7 | Size: Rs 3,273 crore
3. HDFC ELSS Tax Saver Fund (direct mode)
The second largest MF scheme on this list, the HDFC ELSS Tax Saver Fund has 92.7 per cent allocation to equity, out of which, 62.9 per cent is in largecaps, 7.5 per cent in midcaps and 4.1 per cent in smallcaps. Its maximum stock investment is in ICICI Bank, at 9.8 per cent.
NAV: Rs 1,239.1 | Size: Rs 13,938 crore
2. SBI Long Term Equity Fund (direct mode)
This fund is the largest on this list with a daily AUM to the tune of Rs 22,556 crore. The SBI Long Term Equity scheme has 90.2 per cent allocation to equity, out of which, 52.7 per cent is dedicated to largecaps, 13.7 per cent to midcaps and 10.7 per cent to smallcaps. It has holdings in 65 stocks with the maximum weightage to Torrent Power, at 3.9 per cent.
NAV: Rs 404.2
1. Quant ELSS Tax Saver Fund (direct mode)
The Quant ELSS Tax Saver MF scheme has 98.3 per cent allocation to equity. Out of that, while 49 per cent is dedicated to largecaps, 24.7 per cnet is for midcaps and 7.23 per cent for smallcaps.
The fund invests in as many as 44 stocks.
NAV: Rs 404.4 | Size: Rs 9,094 crore
Unimpressed by these returns? Remember the Section 80C tax benefit
ELSS mutual funds offer a lucrative option under Section 80C of the Income Tax Act. By investing in ELSS funds, an investor can avail a tax deduction of up to Rs 1.5 lakh in a financial year. This not only helps in reducing the tax liability but also aids in wealth creation through equity investments. ELSS funds come with a lock-in period of three years, making them a suitable choice for long-term investors looking to save taxes and achieve capital appreciation.