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Nippon India Small Cap Fund (Formerly know as Reliance Small Cap Fund) and HDFC Small Cap Fund both of them belong to the small cap category offered by different fund houses. Though both the schemes belong to the same category of Small cap funds under equity category yet, there are differences between both of them. So, let us understand the differences between both the schemes through this article.
This scheme of Nippon India was launched on April 03, 2008. The scheme’s main objective is to attain long-term Capital appreciation by Investing in equity and equity-related instruments of small-cap companies.
The top 10 holdings of Nippon India Small Cap Fund (as on January 31, 2018) include VIP Industries Limited, RBL Bank Limited, Navin Fluorine International Limited, Zydus Wellness Limited, etc.
From October 2019, Reliance Mutual Fund has been renamed as Nippon India Mutual Fund. Nippon Life has acquired majority (75%) stakes in Reliance Nippon Asset Management (RNAM). The company will continue to run its operations without any change in structure and management.
HDFC Small Cap Fund is a part of HDFC Mutual Fund and was incepted on April 03, 2008. The primary aim of the scheme is to achieve capital growth in the long-term by investing a major portion of its corpus in shares of small cap companies.
As on January 31, 2018, the top 10 holdings of HDFC Small Cap Fund’s Portfolio include Sonata Software Limited, TV Today Network Limited, KEC International Limited, Oriental Carbon & Chemicals Limited, etc.
In this section, the parameters compared are current NAV, Fincash Rating, AUM, their category, expense ratio, exit load and so on. To begin with, the category of these schemes, they both belong to equity category. With respect to the current NAV, both the schemes have different NAV though the difference is not much.
Fincash Ratings for both the Nippon India/Reliance Small Cap Fund and HDFC Small Cap Fund are 4-Star
To summarize, the basic parameters are compared below as follows.
Parameters Basics NAV Net Assets (Cr) Launch Date Rating Category Sub Cat. Category Rank Risk Expense Ratio Sharpe Ratio Information Ratio Alpha Ratio Benchmark Exit Load Nippon India Small Cap Fund
Growth
Fund Details ₹153.904 ↑ 2.00 (1.32 %) ₹45,749 on 31 Mar 24 16 Sep 10 ☆☆☆☆ Equity Small Cap 6 Moderately High 1.82 3.32 0.93 6.47 Not Available 0-1 Years (1%),1 Years and above(NIL) HDFC Small Cap Fund
Growth
Fund Details ₹122.799 ↑ 1.06 (0.87 %) ₹27,574 on 31 Mar 24 3 Apr 08 ☆☆☆☆ Equity Small Cap 9 Moderately High 1.82 2.62 0 0 Not Available 0-1 Years (1%),1 Years and above(NIL)
After looking at the basic parameters let us now look at the performance aspects of both the funds. With respect to performance aspects, there is not much difference in the areas of 1 Month Returns, 3 Month Returns, 6 Month Returns, and 1 Year returns. However, with respect to 3 Year Returns, 5 Year Returns, and Returns Since Inception, there seems a good difference between both of them. In these parameters, the returns of Reliance Small Cap Fund is higher as compared to HDFC Small Cap Fund. Therefore, though HDFC Small Cap Scheme was launched earlier than Reliance’s scheme yet; its performance is better. The table given below shows the performance of both the schemes.
Parameters Performance 1 Month 3 Month 6 Month 1 Year 3 Year 5 Year Since launch Nippon India Small Cap Fund
Growth
Fund Details 3.1% 7.8% 20.8% 54% 33.8% 31.8% 22% HDFC Small Cap Fund
Growth
Fund Details -1.3% 1.7% 14.2% 41.6% 28.9% 24.3% 16.8%
After looking at the 1Y, 3Y, 5Y Performance let us now look at the absolute yearly performance aspects of both the funds in last 5 years. over here Nippon India Small Cap Fund is generating marginally better returns every year in comparison to HDFC Small cap fund.
Parameters Yearly Performance 2023 2022 2021 2020 2019 Nippon India Small Cap Fund
Growth
Fund Details 48.9% 6.5% 74.3% 29.2% -2.5% HDFC Small Cap Fund
Growth
Fund Details 44.8% 4.6% 64.9% 20.2% -9.5%
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In this section of other details, some of the parameters compared are Minimum SIP and lumpsum investment. Though the lumpsum investment in case of both the schemes is same, that is, INR 5,000, nevertheless, in case of SIP, the minimum amount of Reliance is lower as compared to HDFC.
Nippon India/Reliance Small Cap Fund is managed by Mr. Samir Rachh
HDFC Small Cap Fund is managed by Mr. Chirag Setalvad
Parameters Other Details Min SIP Investment Min Investment Fund Manager Nippon India Small Cap Fund
Growth
Fund Details ₹100 ₹5,000 Samir Rachh - 7.25 Yr. HDFC Small Cap Fund
Growth
Fund Details ₹300 ₹5,000 Chirag Setalvad - 9.77 Yr.
Nippon India Small Cap Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 30 Apr 19 ₹10,000 30 Apr 20 ₹7,864 30 Apr 21 ₹15,638 30 Apr 22 ₹21,799 30 Apr 23 ₹24,109 30 Apr 24 ₹38,830 HDFC Small Cap Fund
Growth
Fund Details Growth of 10,000 investment over the years.
Date Value 30 Apr 19 ₹10,000 30 Apr 20 ₹6,705 30 Apr 21 ₹12,755 30 Apr 22 ₹16,795 30 Apr 23 ₹19,360 30 Apr 24 ₹29,246
Nippon India Small Cap Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 4.05% Equity 95.95% Other 0% Equity Sector Allocation
Sector Value Industrials 31.92% Financial Services 13.93% Consumer Cyclical 11.36% Basic Materials 9.98% Technology 8.69% Health Care 7.93% Consumer Defensive 7.14% Communication Services 1.72% Utility 1.38% Energy 1.04% Real Estate 0.31% Top Securities Holdings / Portfolio
Name Holding Value Quantity Tube Investments of India Ltd Ordinary Shares (Industrials)
Equity, Since 30 Apr 18 | 5407622% ₹1,093 Cr 2,924,163 HDFC Bank Ltd (Financial Services)
Equity, Since 30 Apr 22 | HDFCBANK2% ₹890 Cr 6,150,000
↑ 1,000,000 Voltamp Transformers Ltd (Industrials)
Equity, Since 30 Sep 16 | 5327572% ₹836 Cr 864,398 Apar Industries Ltd (Industrials)
Equity, Since 31 Mar 17 | 5322592% ₹754 Cr 1,080,116 Multi Commodity Exchange of India Ltd (Financial Services)
Equity, Since 28 Feb 21 | MCX1% ₹620 Cr 1,851,010 Bharat Heavy Electricals Ltd (Industrials)
Equity, Since 30 Sep 22 | 5001031% ₹618 Cr 25,000,000 State Bank of India (Financial Services)
Equity, Since 31 Oct 19 | SBIN1% ₹609 Cr 8,100,000 Karur Vysya Bank Ltd (Financial Services)
Equity, Since 28 Feb 17 | 5900031% ₹581 Cr 31,784,062 NIIT Learning Systems Ltd (Consumer Defensive)
Equity, Since 30 Jun 23 | 5439521% ₹579 Cr 11,420,240 InterGlobe Aviation Ltd (Industrials)
Equity, Since 30 Nov 22 | INDIGO1% ₹575 Cr 1,619,443 HDFC Small Cap Fund
Growth
Fund Details Asset Allocation
Asset Class Value Cash 9.2% Equity 90.8% Equity Sector Allocation
Sector Value Industrials 25.66% Consumer Cyclical 17.43% Technology 13.31% Financial Services 12.38% Health Care 10.77% Basic Materials 4.93% Consumer Defensive 3.17% Communication Services 2.71% Utility 0.43% Top Securities Holdings / Portfolio
Name Holding Value Quantity Sonata Software Ltd (Technology)
Equity, Since 31 Oct 17 | 5322215% ₹1,241 Cr 17,178,253
↓ -1,451,557 Firstsource Solutions Ltd (Technology)
Equity, Since 31 Mar 18 | 5328094% ₹1,155 Cr 58,422,707
↑ 1,552,248 Bank of Baroda (Financial Services)
Equity, Since 31 Mar 19 | 5321344% ₹1,131 Cr 42,828,792 eClerx Services Ltd (Technology)
Equity, Since 31 Mar 18 | 5329273% ₹840 Cr 3,546,409
↑ 17,531 Aster DM Healthcare Ltd Ordinary Shares (Healthcare)
Equity, Since 30 Jun 19 | 5409753% ₹800 Cr 19,556,503
↑ 1,917,151 Great Eastern Shipping Co Ltd (Industrials)
Equity, Since 31 Jan 15 | GESHIP2% ₹641 Cr 6,404,655 Power Mech Projects Ltd (Industrials)
Equity, Since 31 Aug 15 | POWERMECH2% ₹583 Cr 1,162,932 PNC Infratech Ltd (Industrials)
Equity, Since 31 Oct 15 | PNCINFRA2% ₹567 Cr 12,986,529 Equitas Small Finance Bank Ltd Ordinary Shares (Financial Services)
Equity, Since 31 Dec 20 | 5432432% ₹561 Cr 60,564,526 Bajaj Electricals Ltd (Consumer Cyclical)
Equity, Since 31 Mar 19 | 5000312% ₹534 Cr 5,882,744
Thus, from the above comparisons, we can find that both the schemes are different in certain parameters while same in certain parameters. However, it is always advised to people that they understand the modalities of a scheme completely and check whether it matches their investment objectives before investing. In addition, they can even consult a financial advisor to ensure that the selected fund is in-line with their objectives and they attain it on time.