DSP Tax Saver Fund

DSP Tax Saver Fund. Who should invest?

DSP Group is a 150+ years old financial entity, started back in the 1860s with its stock broking business. And gradually they entered the mutual fund industry. 

DSP AMC was incorporated in 1996, and it is one of India’s leading AMC in India. DSP AMCs offer a wide range of products to meet the requirement of every investor in the best way by offering mutual funds.

DSP AMC has schemes across debt, equity, hybrid, international funds, and ETFs (Exchange Traded Funds). It holds 25 years of Honest Asset Management.

For over two decades DSP has helped its investors to take responsible money decisions based on two pillars i.e., honesty & integrity.

DSP Tax Saver Fund

Investment objective  

The primary investment objective of the Scheme is to seek to generate medium to long-term capital appreciation from a diversified portfolio that is substantially constituted of equity and equity-related securities of corporates and to enable investors to avail of a deduction from total income, as permitted under the Income Tax Act, 1961 from time to time.

Investment process

DSP Tax Saver Fund-Investment-Process

The DSP Tax Saver Fund follows a blended style of investing which consists of value and growth stocks of large-, mid and small-cap companies.

The investment philosophy of the fund is to buy fundamentally strong businesses, which are driven by growth drivers and valuation support to determine relative attractiveness. 

Portfolio construction involves investing in market capitalization companies using top-down and bottom-up approaches. The fund focuses on long-term growth with a portfolio of 60-65 stocks. The fund tracks the stock performance v/s fundamental changes

Portfolio composition 

The portfolio holds the major exposure in large-cap stocks at 70% and sectorally major exposure is to financial services that account for more than one-third of the portfolio.

The top 5 sectors hold nearly 70% of the portfolio. 

DSP-portfolio-composition
Note: Data as of 31st Oct 2022. 
Source: Value Research

Top 5 holdings

Name Sector Weightage % 
HDFC Bank Financial 8.91 
ICICI Bank Financial 8.57 
Infosys Technology 7.02 
Axis Bank Financial 5.02 
State Bank of India Financial 3.75 
Note: Data as of 31st Oct 2022. 
Source: Value Research 

Performance over 15 years

If you would have invested 10 lakhs at the inception of the DSP Tax Saver Fund, it would be now valued at Rs 83.90 lakhs. 

DSP Tax Saver Fund
Note: Performance of the fund since launch; Inception Date – Jan 18, 2007, till Nov 14, 2022. 
Source: Moneycontrol 

The DSP Tax Saver Fund has given consistent returns and has outperformed the benchmark over the period of 15 years by generating a CAGR (Compounded Annual Growth Rate) of 14.38%. 

Fund manager 

Charanjit Singh 

Prior to joining DSP Mutual Fund, he worked with Capital Goods, Power & Infra at B&K Securities India, Capital Goods and Infra at Axis Capital Ltd., BNP Paribas India Securities, Thomas Weisel Partners, HSBC, IDC Corp., and Frost & Sullivan. 

Rohit Singhania 

Prior to joining DSP AMC, he worked with HDFC Securities Ltd. and IL&FS Investsmart Limited. 

Who should invest in DSP Tax Saver Fund? 

Investors looking to 

  • Save taxes by investing in an equity core portfolio 
  • Invest in multi-cap equity allocation 

Why invest in DSP Tax Saver Fund? 

  • Strong stock selection approach using a combination of top-down and bottom-up selection criteria 
  • Shortest lock-in period when it comes to the tax-saving asset class 

Horizon 

  • One should look at investing for a minimum of 5 years or more 
  • A systematic investment Plan (SIP) is an ideal way to take exposure as it helps tackle market volatility. 
Conclusion 

The fund follows a strong approach toward stock selection and tracks the performance of the same.

The fund has delivered consistent returns over 15 years with a proven track record with a 14.38% CAGR consistently. The fund is suitable for investors who want to have core equity with tax benefits.

Disclaimer

This is not recommendation advice. All information in this blog is for educational purposes only.

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