Equity, as the name suggests, is a category where the fund invests in equity and equity related instruments across market capitalization and typically adopts the fundamental style of investing.
An equity mutual fund invests 60% or more of its funds in equity shares of companies. The could be a purely large-cap fund or a mixture of stocks of companies with different. Moreover, the investing style may be value-oriented or growth-oriented. SEBI has fixed the upper limit of expense ratio at 2.5% for equity funds and may reduce it even further.
#1 Equity Mutual Funds: IDFC Core Equity Fund – Direct – Growth
IDFC Core Equity Fund (Erstwhile IDFC Classic Equity) seeks to generate long-term capital growth by investing predominantly in large-cap and mid-cap stocks. The fund has generated over 15% returns for the five-year period.
The fund is currently managed by Anoop Bhaskar since April 2016 and could continue to maintain its performance given its large-cap bias and fundamentally sound holdings.
#2 Equity Mutual Funds: Aditya Birla Sun Life Equity Advantage Fund – Direct – Growth
Aditya Birla Sun Life Advantage Fund seeks to achieve long-term growth at relatively moderate levels of risk through a diversified investment approach. The fund seeks to identify companies with sound corporate management and prospect of good future growth.
The fund has generated over 22% returns over the five-year period. The fund is currently managed by Satyabrata Mohanty since October 2011. The fund is likely to continue with its performance streak over the long term given the bottom-up stock selection approach adopted by the fund manager.
#3 Equity Mutual Funds: DSP Equity Fund – Direct – Growth
DSP BlackRock Equity Fund seeks to generate long-term capital appreciation, from a portfolio of equity and equity-related securities. The fund has generated nearly 18% returns over the five-year period and is currently managed by Atul Bhole since June 2016.
The fund is likely to continue with its performance as the fund manager follows an approach of picking individual investment opportunities with both value and growth strategy.
#4 Equity Mutual Funds: Franklin India Prima Fund – Direct – Growth
Franklin India Prima Plus seeks to provide growth of capital and regular dividend from a portfolio of equity, debt and money market instruments and focusing on wealth creating companies across all sectors and market cap ranges. The fund has provided consistent returns generating over 18% returns over the five-year period.
The fund is managed by R Janakiraman since February 2011. The performance is likely to continue given the fact that the fund invests in wealth-creating companies whose competitive advantages are likely to translate into a superior return over the long term. We believe this is a fund one can rely on to deliver over the market cycle.
#5 Equity Mutual Funds: HDFC Equity Fund – Direct – Growth
HDFC Equity Fund seeks to generate capital appreciation/income from a portfolio, predominantly invested in equity; equity related instruments. The fund generated over 16% returns over the five-year period.
The fund is managed by Prashant Jain since June 2003. Given the bottom-up stock selection approach adopted by the fund manager, the performance is likely to remain healthy but the fund is aggressive with respect to market given high beta of 1.2 times.
#6 Equity Mutual Funds: ICICI Prudential Multicap Fund – Direct – Growth
ICICI Prudential Multicap fund seeks to generate capital appreciation through investments in equity; equity related instrument across sectors and market capitalization.
The fund generated over 18% returns over the five-year period and is managed by Atul Patel since August 2016. The fund is likely to continue with its performance but remains conservative with respect to market given low beta of 0.84 times.
#7 Equity Mutual Funds: Invesco India Growth Opportunities Fund – Direct – Growth
Invesco India Growth Opportunities Fund (Erstwhile Invesco India Growth Fund) seeks to generate capital appreciation from a diversified portfolio of predominantly Equity and Equity Related Instruments of Large and Midcap companies. The five-star rated fund generated over 18% returns over the five-year period and is managed by Taher Badshah since January 2017.
The fund approaches fundamental approach to stock selection and invests in sunrise sectors that provide immense growth opportunities. Thus, the performance is likely to continue over the long-term.
#8 Equity Mutual Funds: Kotak Standard Multicap Fund – Direct – Growth
Kotak Standard Multicap Fund (erstwhile Kotak Select Focus Fund) seeks to identify sectors that are likely to do well over the medium term and invest in multi-cap stocks within these sectors. The fund has sizeable exposure to large-cap stocks that have performed consistently and has been able to generate 20% over the five-year period.
The fund is managed by Harsha Upadhyaya since August 2012 and is likely to continue with its performance streak given fundamental stock selection approach with balanced portfolio (beta close to 1).
#9 Equity Mutual Funds: Mirae Asset Large Cap Fund – Direct – Growth
Mirae Asset India Equity Fund (Erstwhile Mirae Asset India Opportunities) seeks to maximize long-term capital appreciation by finding investment opportunities resulting from Indian economic growth and its structural shifts through investing in equity and equity-related securities. The fund has generated over 20% returns during the five-year period and is managed by Harshad Borawake since May 2017.
There has been a change in the leadership off-late and Neelesh Surana was associated with the fund since May 2008. With a balanced approach and fundamental investing, the performance is likely to continue over a business cycle.
#10 Equity Mutual Funds: SBI Magnum Multi Cap Fund – Direct – Growth
SBI Magnum Multicap Fund seeks to invest in equities and equity related instruments of companies spanning the entire market capitalization spectrum. The five-star rated fund generated over 20% returns during the five-year period.
The fund is managed by Anup Upadhyay since February 2017. With bottom-up approach and flexible approach to market capitalization, the performance is likely to continue over the long-term.
Our Approach to Evaluating Best Equity Mutual Funds:
We have evaluated based on both qualitative and quantitative factors such as returns, fund size, fund managers, the reputation of fund house, and investment philosophy. Here is our analysis:
|Large-Mid||NAV / Index Value||Annualized Return %|
|Rank||1 Year||3 Years||5 Years||10 Years||Since Inception|
|IDFC Core Equity Fund||2530.03||44.42||12||14.34||10.77||15.83||9||12.51|
|Aditya Birla Sun Life Equity Advantage Fund||5819.08||409.54||34||10.79||10.9||22.5||12.23||18.38|
|DSP Equity Fund||2329.73||37.02||25||13.73||9.12||17.91||12.77||12.85|
|Franklin India Prima Fund||11615.89||569.03||13||9.26||8.3||18.7||13.56||18.74|
|HDFC Equity Fund||21621.14||595.02||33||9.37||7.83||16.61||13.58||19.2|
|ICICI Prudential Multicap Fund||2873.35||271.84||8||6.66||10.74||18.98||12.04||15.08|
|Invesco India Growth Opportunities Fund||335.91||32.1||4||20.82||10.13||18.9||12.22||11.57|
|Kotak Standard Multicap Fund||17802.56||32.11||11||11.65||11.66||21.02||N.A||14.6|
|Mirae Asset Large Cap Equity Fund||6785.26||45.38||23||13.67||11.33||20.57||N.A||16.33|
|SBI Magnum Multi Cap Fund||4532.23||46.42||16||14.5||12.46||21.09||10.94||13.05|