Nippon India Small Cap Fund Growth Direct Plan

About Nippon India Small Cap Fund – Growth – Direct Plan

Nippon India Small Cap Fund – Growth – Direct Plan is a mutual fund managed by Nippon India Mutual Fund. It has a track record of delivering good returns over the long term. As a direct plan, the fund has lower expense ratios and no commissions, making it a more cost-effective option for investors looking to invest in small-cap companies. However, investing in small-cap companies involves higher risks and volatility than investing in large-cap or mid-cap companies.

Key Parameters

Nippon India Small Cap Fund – Growth – Direct Plan is a mutual fund scheme meant to provide capital growth in the long run by funding an array of small-cap companies that enables one to diversify their portfolio. The key parameters of this fund are as follows:

Taxation

Investor needs to know the tax implications on their returns. In the case of Nippon India Small Cap Fund – Growth – Direct Plan, a small-cap mutual fund, the taxation is as follows:

• There will be a 15% tax that the investor has to incur if held the returns for under a year.

• Additionally, a 10% tax will be imposed on investments that have been kept for more than one year. These can be considered under long-term monetary appreciation.

• Any dividends earned will be taxed per the prevailing tax bracket. Moreover, there are waivers for any investment under INR 1 Lakh.

Holdings

Nippon India Small Cap Fund – Growth – Direct Plan has diversified its portfolio across several sectors, including Chemicals, IT software, private bank, Basic Materials, Financial Services, Consumer Defensive, Tech, Health, Energy, Communication, Utilities, and Real Estate. In addition, the list of top Nippon India Small Cap holdings includes Tube Investments of India Ltd Ordinary Shares, HDFC Bank Ltd, KPIT Technologies Ltd, Bank of Baroda, and NIIT Ltd.

Return Potential

Nippon India Small Cap Fund – Growth – Direct Plan is a fund that invests in enterprises with a market capitalisation of less than INR 7500 crores. The fund has delivered 24.21% average annual returns since launch. It has a high risk and high return profile. Small-cap funds are mutual funds that invest in companies with small market capitalisation. These companies have the potential to grow faster than large-cap companies but are also more volatile. The fund has delivered 5.28% returns in the last year and 24.21% average annual returns since launch. The scheme’s ability to deliver returns consistently is higher than most funds of its category.

The Investment Objective

Primarily, the main aim for an investor to deploy their capital in the fund is to create future wealth out of equity and related securities of MSME companies. The fund has most of its money invested in Capital Goods, Financial, Chemicals, Consumer Staples, and Technology sectors.

Minimum Investment and Lock-in Period

The minimum investment amount is INR 5,000 and multiples of INR.1 afterwards. The fund has no lock-in period.

Nippon India AMC

Nippon India Asset Management Company (AMC) is one of India’s leading asset management companies, with a history of over 25 years in managing investments across equity, fixed income, and other asset classes. The company was formerly known as Reliance Nippon Life Asset Management Limited but was rebranded as Nippon India AMC in 2019 after the exit of its joint venture partner, Reliance Capital.

Nippon India AMC manages a diverse range of mutual fund schemes catering to the investment needs of individual and institutional investors. The company is known for its strong research capabilities, robust risk management systems, and focus on long-term wealth creation for its investors.