Nippon India Consumption Fund Vs SBI Consumption Opportunities Fund

Nippon India Consumption Fund (Formerly known as Reliance Consumption Fund) and SBI Consumption Opportunities Fund belong to the equity category of Mutual Funds. Though both the funds focus on the consumption space, there are still many differences between them. This article is to help investors to make a better investment decision between both the funds. As these funds belong to the sector-equity category, they carry a high-risk with them. Thus, investors with a high-risk appetite should only plan to add these schemes in their Portfolio.

Important Information

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.

Nippon India Consumption Fund (Formerly Reliance Consumption Fund)

Nippon India Consumption Fund (earlier known as Reliance Consumption Fund) was launched in the year 2004. The scheme aims to generate long-term Capital appreciation by Investing atleast 80 percent of its net assets in equity and related instruments of the companies that are likely to benefit directly or indirectly from the domestic consumption led demand. Nippon India Consumption Fund has a focussed approach to invest in the potential leaders across the media and entertainment domain. It is well diversified across key segments like the Internet, Broadcasting, Distribution, Print, etc., driven by the relative attractiveness of opportunities and valuations. The fund is jointly managed by Sailesh Raj Bhan and Jahnvee Shah.

SBI Consumption Opportunities Fund (Erstwhile SBI FMCG Fund)

SBI Consumption Opportunities Fund (earlier known as SBI FMCG Fund) was launched in the year 1999. The scheme aims to provide long-term capital appreciation by investing in a diversified portfolio of equity related securities in consumption space. The fund will follow a bottom-up approach to stock-picking and choose companies within the consumption space. SBI Consumption Opportunities Fund is currently managed by Saurabh Pant. Some of the top holdings of the scheme are ITC Ltd, CCIL-Clearing Corporation of India Ltd (CBLO), Colgate Palmolive, Nestle India Ltd, Sheela Foam Ltd, etc.

Nippon India Consumption Fund Vs SBI Consumption Opportunities Fund

Though these schemes belong to the same category, yet these schemes differ on various parameters. So, let us understand the parameters which are divided into four sections, namely, Basics Section, Performance Report, Yearly Performance Report, and Other Details Section.

Basics Section

This section compares the various elements such as Current NAV, Scheme Category, and Fincash Rating. To begin with the scheme category, it can be said that both the schemes- Reliance/Nippon India Consumption Fund and SBI Consumption Opportunities Fund belong to the same category Equity Mutual Fund. With respect to the next parameter, that is, Fincash Rating, it can be said that Reliance Consumption Fund is rated as 2-Star and SBI Consumption Opportunities Fund is rated as 4-Star. In case of Net Asset Value, Nippon India Consumption Fund's NAV as on 16th July 2018 is INR 61.4888, whereas the NAV of SBI Consumption Opportunities Fund is INR 116.222. The table given below summarizes the details of basics section.

Performance Section

The performance section compares the Compounded Annual Growth Rate or CAGR returns between both the schemes at different time periods. With respect to performance, it can be said there is not much difference in the performance of both the schemes. However, in many instances, SBI Consumption Opportunities Fund leads the race. The performance of both the schemes at different time periods is shown below as follows.

Yearly Performance Section

This section deals with the absolute returns generated by both the funds in each year. In this case, we can see that there is a difference in the performance of both the schemes. In certain situations, Reliance Consumption Fund has performed better than SBI Consumption Opportunities Fund. While in some situations, the other scheme has performed better. The yearly performance of both the funds is tabulated as follows.

Other Details Section

This is the last section in the comparison of both the funds. In this section, the parameters such as AUM, Minimum SIP and Lumpsum Investment, and Exit Load are compared. To begin with the minimum SIP investment, it can be said the SIP amounts are different in both the schemes. In case of Nippon India Consumption Fund it is INR 100 while in case of SBI Consumption Opportunities Fund it is INR 500. But, in case of minimum lumpsum investment, the amount is same for both the funds, i.e., INR 5,000. The AUM of both the schemes are also different. As on 31st May, 2018, the AUM of Reliance/ Nippon India Consumption Fund is INR 66 crores, while of SBI Consumption Opportunities Fund is INR 621 crores. The table given below summarizes the other details for both the schemes.

Growth of 10k Investments over the years