Are you on the hunt for an aggressive equity multi-cap fund that has a relatively larger exposure to small- and mid-cap stocks than its peers? Then SBI Magnum Multicap Fund, which invests in stocks across the market capitalisation spectrum, fits the bill. The fund may not have set the charts on fire but has scored well in the recent past, benefiting from its multi-cap stance. Long-term investors with a moderate risk appetite can buy this fund.
Over the last one, three and five years, the fund has beaten its benchmark, BSE 500, by 7-10 percentage points. While it outshone its peers in the last one year, it has slightly lagged top-performing funds over three and five years.
Not to be confused with its cousin, SBI Magnum Multiplier Fund, which has a higher large-cap slant of around 6 per cent and is benchmarked to the BSE 200, the fund has improved the consistency of its performance. On a one-year rolling return basis, it has beaten its benchmark 81 per cent of the time in the last five years; over a three-year period it is a healthier 93 per cent.
Portfolio moves
After a lacklustre 2013, as the market zoomed in 2014 fuelled by the election euphoria, the fund's performance too picked up pace. Its large-cap holdings across sectors worked to its advantage. Stocks such as Procter & Gamble (Consumer), State Bank of India and ICICI Bank, Maruti Suzuki and Tata Motors DVR (Auto) surged between 60 and 90 per cent, boosting returns.
Its mid- and small-cap holdings were packed with stellar performers as well. Stocks such as Bharat Petroleum, Shriram City Union, JK Tyre and Redington boosted returns — gaining between 80 and 270 per cent.
As euphoria gave way to reality and markets turned choppy in 2015, the fund gained in strength, returning 10 per cent even as the S&P BSE 500 remained flat. It benefited by upping its exposure in refinery, pharmaceutical and select private sector banks — stocks such as HPCL, Aurobindo Pharma, Natco Pharma and Kotak Mahindra Bank. Adding stocks which found favour with investors such as Bajaj Finance, Cholamandalam Investments and Sagar Cements boosted performance. On the other hand, exiting positions in ICICI Bank, DCB Bank, Tech Mahindra, AIA Engineering and Tata Steel helped cap losses.
Occasionally, the fund takes a slightly larger exposure to cash as witnessed from December 2011 to March 2012, when it ranged between 7.5 and 9 per cent.
Current stance
The fund's top sector holdings are in financial services, consumer goods, IT, energy and autos. The top 10 stocks constitute 34 per cent of total assets.
The fund has a 58 per cent exposure to large-cap, 32 per cent to mid-caps and 7 per cent to small-caps.
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