UTI-long-term-equity-fund

UTI Long-Term equity

UTI is one of the pioneers of the Indian Mutual Fund Industry. With over Rs 2.4 lakh crore, the AMC is one of the most trusted names in the mutual fund space. The AMF offers products across asset classes.  

Let us talk about the flagship product – UTI Long-Term Equity Fund

About UTI Long-Term Equity Fund 

Investment Objective

The primary objective of the scheme is to invest predominantly in equity and equity-related securities of companies across the market capitalization spectrum.

Securities shall also include fully/partly convertible debentures/bonds. 

Investment Process 

The UTI Long Term Equity Fund carries a top-down approach for sector selection and a bottom-up for stock selection.

It follows a blended style of investing with a preference for companies with consistent cash flow generation, healthy balance sheets,s and reasonable valuations. 

Portfolio Composition 

The portfolio holds the major exposure in large-cap stocks at 76% and sectoral major exposure is to financial services which account for roughly one-third of the portfolio. The top 5 sectors hold nearly 75% of the portfolio. 

UTI-long-term-equity-portfolio-composition
Note: Data as of 30th Sep 2022. 
Source: UTIMF 

Top 5 holdings

Name Sector Weightage % 
ICICI Bank Financial Services 8.53 
HDFC Bank Financial Services 7.58 
Infosys Information Technology 6.35 
Axis Bank Ltd. Financial Services 4.58 
Bharti Airtel Ltd. Telecommunications 3.73 
Note: Data as of 30th Sep 2022. 
Source: UTIMF 
 

Performance over 22 years 

If you would have invested 10,000 at the time of inception of the UTI Long Term Equity Fund, it would be now valued at Rs 2.22 Lakhs whereas the benchmark (Nifty 500 TRI) would have fetched you Rs 1.89 Lakhs.

UTI-long-term-equity-investment-performance-over-22-years
Note: Performance of the fund since launch; Inception Date – Dec 15, 1999 
Source: utimf.com 
 

The UTI Long Term Equity Fund has given consistent returns and has outperformed the benchmark over the period of 22 years generating a CAGR (Compounded Annual Growth Rate) of 14.65%. 

Fund Manager 

The fund is ably managed by Vishal Chopda. Vishal Chopda is the Vice President and Fund Manager in the domestic Equity Division of UTI Asset Management Company Ltd.

Vishal joined UTI AMC in January 2011. After joining UTI, he has worked for the past 7 years in the Department of Fund Management as Research Analyst.

He has previously worked with CARE Ratings (Credit Analysis and Research Ltd). He is a CFA Charter holder from The CFA Institute, USA, and also holds a PGDM from Management Development Institute, Gurgaon. He has completed his B.E. from Mumbai University. 

UTI-long-term-equity

Who should Invest in UTI Long-Term Equity Fund? 

Investors looking for 

  • Equity Linked Savings Scheme (ELSS) that aims to generate long-term capital appreciation by primarily investing in equity and related securities. 
  • a long-term wealth creation vehicle investment horizon.

Why Invest in UTI Long-Term Equity Fund? 

  • Provides tax deduction up to the limits specified u/s 80C of the Income Tax Act, 1961. 
  • The fund attempts to invest in businesses having healthy return ratios, cash flows, and sound management, with an aim to provide superior risk-adjusted return 

Horizon 

  • One should look at investing for a minimum of 5 years or more 
  • Lumpsum is a better way to invest in ELSS to avoid a prolonged lock-in period on your SIP investments. 
Conclusion 

The UTI Long Term Equity Fund is the oldest fund with a proven track record of 22 years and has delivered 14.65% CAGR consistently.

Thus, suitable for even first-time equity investors who want to earn better risk-adjusted returns and avail of tax exemptions at the same time. 

Disclaimer

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

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