2 Best 5-Star Rated ELSS Funds For SIP In 2021 With 1 Year CAGR of Over 60%

Personal Finance

[ad_1]

Read More/Less


Should I Invest In ELSS?

According to research published by S&P Indices Versus Active (SPIVA), over the one-year period ending in June 2021, the S&P BSE 200 ended in the green, returning 58.77%. Another reason is that, according to the Associations of Mutual Funds in India (AMFI), these funds have the highest portfolio record of 1,29,69,205 among Growth/Equity Oriented Schemes in September.

They can provide above-average and risk-adjusted returns over the long term, particularly 3 to 5 years. In terms of absolute return, ELSS funds have beaten the Index by 53.66 percent in one year, 76.19 percent in three years, 76.19 percent in five years, and 48.57 percent in ten years. Whereas these funds have also outperformed the Index based on risk-adjusted return, as Indian ELSS have generated 46.34% returns in 1 year, 76.19% in 3 years, 80.95% in 5 years and 51.43% in 10 years, according to the scorecard of SPIVA as of June 30, 2021.

Apart from having exposure to equity and equity-related instruments, ELSS also has exposure to fixed income securities, making it a must-have fund in your portfolio for long-term inflation-beating returns, as well as a blend of tax deductions and wealth creation.

As a result, based on the scheme’s performance, asset under management, and Morningstar’s 5-star rating, we’ve selected two ELSS funds that you can consider for SIP in 2021 in order to generate higher long-term returns than other tax-saving investments such as tax-saving fixed deposits, PPF, NSC, and so on.

DSP Tax Saver Fund Regular Plan Growth

DSP Tax Saver Fund Regular Plan Growth

Having been launched in the year 2013 this fund has been rated 5-star by Morningstar as of 12th August 2021 which indicates a SIP call for the investors. According to the report of the fund house, this ELSS scheme returns of the last 1-year are 68.16% and since launch, it has delivered 18.88% average annual returns as of October 29, 2021.

The fund has its top equity allocation across the Financial, Technology, Energy, Construction, Chemicals sectors. ICICI Bank Ltd., HDFC Bank Ltd., Infosys Ltd., Axis Bank Ltd., and State Bank of India are the fund’s top five holdings. This fund has an Asset Under Management (AUM) of Rs 9,755.66 crores as of September 30, 2021, and a Net Asset Value (NAV) of Rs 89.38 as of November 2, 2021. The fund has an expense ratio of 0.81% as of Nov 02, 2021 and SIP can be started with Rs 500.

Period DSP Tax Saver Fund NIFTY 500 TRI NIFTY 50 TRI
CAGR since Inception 18.88% 15.20% 14.53%
1 Year 68.16% 59.08% 53.69%
3 years 25.53% 21.24% 20.82%
5 Years 17.40% 16.35% 16.81%
Data as of October 29, 2021. Source: invest.dspim.com

Axis Long Term Equity Fund Growth

Axis Long Term Equity Fund Growth

This ELSS mutual fund has also been rated 5-star by Morningstar as of 30 Dec 2019. Axis Long Term Equity Fund which is active since 2009 has generated good returns of 62.42% in 1-year and since launch, it has delivered 18.76% average annual returns as of September 30, 2021 according to the data of the fund house. The fund’s best equity allocation is spread across the Financial, Services, Technology, Chemicals, Healthcare sectors.

Bajaj Finance Ltd., Avenue Supermarts Ltd., Tata Consultancy Services Ltd., Info Edge (India) Ltd., and Housing Development Finance Corpn. Ltd. are the fund’s top five holdings. As of September 30, 2021, this fund has an Asset Under Management (AUM) of Rs 34,370.78 crores and a Net Asset Value (NAV) of Rs 76.00 as of November 2, 2021. As of November 2, 2021, the fund has an expense ratio of 0.74 percent, which is lower than most other ELSS funds, and SIPs may be started with as little as Rs 500 towards the fund.

Period Annualised(%) S&P BSE 200 TRI Benchmark(%) Nifty 50 TRI Additional Benchmark (%)
Since inception 29th Dec 2009 18.76% 12.79% 12.31%
5 Years 17.96% 16.85% 16.81%
3 Years 21.74% 19.44% 18.58%
1 Year 62.42% 61.22% 58.54%
Data as of September 30, 2021. Source: axismf.com

Best ELSS Funds For SIP In 2021

Best ELSS Funds For SIP In 2021

Here are two ELSS funds to consider for SIP in 2021, based on Morningstar’s 5-star rating and tremendous one-year return.

Funds 1 mth returns 6 mth returns 1 Yr returns 3 Yr returns 5 Yr returns
DSP Tax Saver Fund Regular Plan-Growth 2.38% 25.33% 66.92% 24.41% 16.89%
Axis Long Term Equity Fund Growth 1.27% 24.61% 57.67% 23.87% 19.04%
Source: Groww

Disclaimer

Disclaimer

The views and investment tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advice to buy or sell stocks, gold, currency, or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates, and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in



[ad_2]

CLICK HERE TO APPLY

Leave a comment

Can blockbuster results fuel further rerating of SBI stock?, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


MUMBAI: State Bank of India (SBI) continued to surprise Dalal Street on the earnings front as the lender posted another set of blockbuster numbers for the September quarter.

The state-owned lender’s net profit grew 67 per cent year-on-year (YoY) to Rs 7,627 crore in the quarter ended September 2021, while its net interest income (NII) climbed 29 per cent on-year to Rs 31,183.9 crore. Both the bottomline and topline of the lender came in above Street’s expectations.

That said, here are the major takeaways from the September quarter earnings of the lender:

Asset quality keeps improving
At the peak of the bad loans crisis of the financial sector, State Bank of India had some of the poorest asset quality numbers. Every quarter saw investors anxious about slippages and new NPA formation. Fast forward to 2021 and the lender is now surprising the Street on how healthy its balance sheet is becoming.

For the reported quarter, SBI reported a 42 basis points sequential decline in gross non-performing assets ratio to 4.9 per cent and a 25 bps decline in net NPA ratio to 1.52 per cent. Further, the provision coverage ratio has now gone up to 87.7 per cent for the lender.

Slippages benign
During the quarter the lender’s slippage ratio fell to 0.66 per cent from 2.47 per cent in the previous quarter. The state-owned bank added merely Rs 6,690 crore of loans to the watchlist in the quarter as against Rs 11,303 crore in the previous quarter.

The shrinking watchlist loans indicate that the lender is facing lower stress on its balance sheet that should free up more capital for growth purposes as the economy gets back up from the pandemic downfall.

Loan growth needs more push
SBI said that its advances in the quarter grew 6.2 per cent year-on-year, which was in-line with its overall guidance for the year. Interestingly, retail loans in the quarter jumped 15.2 per cent whereas home loans grew by 10.7 per cent.

With the balance sheet becoming healthier every quarter, SBI will hope to accelerate its lending business in the coming quarters. An increase in loan growth coupled with improving asset quality would force investors to rerate a lender that still trades at merely 7 times one-year forward earnings and 1.1 times one-year forward price-to-book.

Corporate loans struggling
The state-owned lender reported a near 4 per cent year-on-year decline in its corporate loan book suggesting that companies are still not ready to take on leverage to boost capacity.

However, investors expect that to change in the coming quarters as rapid demand creation in the economy on the back of reopening and higher vaccination rate will nudge companies to boost capacities in the coming year. SBI is considered by many brokerages as one of the primary beneficiaries of the private capex revival in the economy over the next five years.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , ,

SBI net profit up 67% in Q2, chairman says asset quality significantly improved, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


The State Bank of India, India’s largest lender, today reported a standalone net profit of Rs 7,626 crore, up 67% on year, the highest ever for the bank.

A year ago, the bank reported a net profit of Rs 4,574 crore. On a sequential basis, the profit rose 17% from Rs 6,504 crore in the June quarter.

The bank’s asset quality has significantly improved, chairman Dinesh Khara said at the earnings announcement.

Gross non performing assets came in at 4.90% in the September quarter, lower than 5.32% in the June quarter and 5.28% in the year ago quarter.

Meanwhile, the net NPA ratio stood at 1.52% for the quarter.

The net interest income (NII) – the difference between interest earned and expended – rose 10.6% to Rs 31,184 crore in Jul-Sep.

The non interest income fell 3.7% to Rs 8,207 crore compared with Rs 8,527 crore a year ago.

Khara highlighted that the capacity utilisation of manufacturing is still very low. Advances rose by just 6.17% over last year, driven by personal retail advances, up 15.17% on year, and foreign office advances, up 16.18% on year.

Domestic advances grew 4.61%, with home loans, which constitute 24% of domestic advances, rising 10.74% on year.

Total deposits grew nearly 10% on year, current account deposits grew 19.2% and saving bank deposits grew 10.55%.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , , ,

RBI panel spells out norms to streamline functioning of ARCs

Banking & Finance

[ad_1]

Read More/Less


The performance of asset reconstruction companies (ARCs) in management of stressed assets of banks/financial institutions (FIs) since inception in 2003 is still uneven on several parameters, according to a Reserve Bank of India’s Committee to Review the Working of Asset Reconstruction Companies.

Overall recovery made by the ARC sector during FY04-FY13 was 68.6 per cent when measured in terms of redemption of Security Receipts (SRs), which are issued by ARCs as part of securitisation of assets acquired, as a percentage of total SRs issued, the report said.

However, the same comes down to 14.29 per cent when the redemption is measured in terms of the book value of the assets acquired.

RBI panel favours sale of stressed assets by lenders at early stage

“This implies that banks and other investors could recover only about 14 per cent of the amount owed by their borrowers,” the committee headed by Sudarshan Sen, former Executive Director, RBI, said.

The total SRs issued reflects the cost of acquisition for the ARCs vis-à-vis the book value of such financial assets. Redemption of SRs is a proxy for the amount recovered from these accounts.

ARCs are required to resolve the assets within a maximum of eight years of acquisition of financial assets and redeem the SRs representing the assets. Therefore, the period after FY13 has SRs for which resolution is still underway.

Winds of change in the stressed assets market

Business revival

The committee observed that ARCs’ performance in ensuring revival of businesses has also been poor. The data indicate that approximately 80 per cent of the recovery for the sector, so far, has come through deployment of methods of reconstruction that do not necessarily lead to revival of business.

“ARCs have rarely used methods such as change in or takeover of the management of the business of the borrower or conversion of debt into equity in a borrower’s company,” the panel said.

Rescheduling of payment of debts was also involved only in 19.9 per cent of the recovery made by ARCs.

The committee underscored “The overall performance of ARC Sector has left much to be desired. However, it would be incorrect to assume that the problems of ARC sector are entirely of its own making. In fact, the ageing of NPAs before their sale may be contributing to poor recovery. This gets further aggravated by lack of debt aggregation.”

Revival of stressed business typically requires additional funding which is difficult to come by for old NPAs.

“Inadequate capital at ARC level and the regulatory prescription limiting the extent of funds that could be raised, from external investors through securitisation, seems to have made ARCs’ attempt at revival of businesses even more difficult. ARCs’ lack of skill sets in turning around borrowers cannot be ignored,” the committee said.

The panel emphasised that despite the reshaping of the ecosystem available for lenders for handling of stressed assets and the ARC sector’s sub-optimal performance and its challenges, the ARC model remains relevant as a private sector led permanent institutional framework for out-of-court resolution of stressed assets of the financial sector.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , ,

2 Pharma Stocks To Buy From ICICI Securities

Personal Finance

[ad_1]

Read More/Less


Ajanta Pharma

Ajanta Pharma’s today’s share price is Rs. 2085 per share on November 3, till 2.00 PM IST. ICICI Securities has given a target price of Rs. 2500 per share with a target period of 12 months for the stock.

The company is a focused player in branded, which constitutes ~70% of overall sales. Till FY21 their overall exports: domestic formulations ratio was at 70:30. Ajanta Pharma’ in Q2FY22 reports a strong number, which was ahead of estimates on their sales front. Their sales were up 23.6% YoY to Rs. 884.8 crore. Ajanta’s PAT grew 15.1% YoY to Rs. 195.9 crore.

According to ICICI Securities, “Ajanta’s share price has grown by ~1.4x over the past 5 years (from ~ Rs. 1502 in June 2016 to ~ Rs. 2126 levels in October 2021). We retain our BUY rating on the stock with a focused approach. We value Ajanta at Rs. 2500 i.e. 30x P/E on FY23E EPS.”

Additionally, the brokerage firm said, Ajanta’s “Q2 results were driven by growth across segments amid some dip in gross margin performance. The management expects to maintain domestic growth momentum in FY22 leveraging on the already launched products. On the EBITDA margins front, the management expects to maintain the current rate in FY22. Overall, calculated focus, steady gross margins, and lighter balance sheet are some key differentiators for Ajanta, going ahead.”

Sun Pharmaceutical Industries (SUNPHA)

Sun Pharmaceutical Industries (SUNPHA)

Sun Pharmaceutical Industries (SUNPHA) is having a share price of Rs. 786.55 on November 3, till 2.10 PM IST. ICICI Securities has identified it as a stock to buy. ICICI Securities has given a target price of Rs. 965 with a Target Period of 12 months for this company’s stock.

ICICI informs, “Sun Pharma is world’s fourth-largest specialty generic company with sales of US$3.8 billion and boasts of 43 manufacturing sites addressing segments, like specialty products, branded generics, complex generics, pure generics and APIs.” Sun Pharma has a market share of 8.2%, and the company is ranked No. 1 in domestic formulations while enjoying a leadership position in 11 specialties based on prescription.

In Q2FY22 Sun Pharma reports strong Q2FY22 results, their sales were up 12.5% YoY to Rs. 9625.9 crore and EBITDA was at Rs. 2629.9 crore, which was up 19.9% YoY with margins at 27.3%. Additionally, their consequent adjusted PAT stood at Rs. 2047 crore that increased by 12.9% YoY.

According to ICICI Securities, “Sun Pharma’s share price has increased by ~1.06x over the past 5 years (from ~ Rs. 763 in June 2016 to ~Rs. 815 levels in October 2021). We change our rating from HOLD to BUY due to more consistency on the specialty front and linear growth trajectory India formulations. Higher contribution from specialty and the strong domestic franchise is likely to change the product mix towards more remunerative businesses by FY23.”

Disclaimer

Disclaimer

The above stocks were from the brokerage report of ICICI Direct. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution. Greynium Information Technologies, the author, and the brokerage house are not liable for any losses caused as a result of decisions based on the article.



[ad_2]

CLICK HERE TO APPLY

Leave a comment

U GRO Capital Q2 net profit down 80%

Banking & Finance

[ad_1]

Read More/Less


U GRO Capital reported an 80 per cent drop in its net profit for the second quarter of the fiscal at ₹3.37 crore compared to ₹17.17 crore in the same period last fiscal.

For the quarter ended September 30, 2021, its total revenue jumped up by 80.1 per cent to ₹62.7 crore from ₹34.82 crore a year ago.

Net interest income for the second quarter of the fiscal increased by 53 per cent to ₹31.7 crore compared to ₹20.7 crore in the second quarter of last fiscal.

Net interest margin improved 40 basis points Q-o-Q to 7.7 per cent largely due to reduction in the borrowing cost, U GRO Capital said in a statement on Wednesday.

However, total expenses also shot up by 80.1 per cent on a year-on-year basis to ₹57.98 crore in the second quarter of the fiscal.

The total provisioning as of September 2021 was ₹24.2 crore versus the regulatory requirement of ₹22.1 crore.

Disbursements for the quarter grew 139 per cent sequentially to ₹790 crore.

“The company clocked its highest ever disbursements in September 2021 at ₹288 crore,” it added.

“We will carry on the momentum and traction which is now coming because of the infrastructure we have built over last one year and we have a clear path of achieving our mission of serving 10 lakh customers and take one per cent market share of outstanding MSME credit in the country,” said Shachindra Nath, Executive Chairman and Managing Director of U GRO Capital.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,

IBC needs a stronger push: Crisil

Banking & Finance

[ad_1]

Read More/Less


The Insolvency and Bankruptcy Code (IBC) needs a stronger push after recovery of about ₹2.5 lakh crore over five years since it took effect, according to Crisil Ratings.

From here, reforms must stress quicker resolution and maximise recovery, the credit rating agency said in a study.

Per the agency: “A closer look at the data shows, however, the recovery rate and resolution timelines have a lot more room for improvement.

“This makes a continuous strengthening of the Code and stabilisation of the overall ecosystem imperative.”

Lesser traction

As of June 30, 2021, IBC had enabled recovery of about ₹2.5 lakh crore, against admitted financial claims of about ₹7 lakh crore, translating to a recovery rate of 36 per cent for the 396 cases resolved out of the total 4,541 admitted.

Of the remaining cases, 1,349 were under liquidation; 1,114 were closed under appeal/ review/ settled or withdrawn, and 1,682 were outstanding.

The agency emphasised that the recovery marks a significant shift in the insolvency resolution process and credit culture in India.

Gurpreet Chhatwal, Managing Director, Crisil Ratings, said: “The recent resolution of a large financial services firm with a recovery of about ₹37,000 crore against admitted financial claim of about ₹87,000 crore, translating to a recovery rate of about 43 per cent, underscores the efficacy of IBC. The resolution value was about 1.4 times the liquidation value.”

The agency underscored that while the IBC has tilted the power equation in favour of creditors from debtors and helped strengthen India’s insolvency resolution ecosystem, its performance against its twin objectives – maximisation of recovery and timebound resolution – has been a mixed bag.

“One, only a few large cases have seen higher recovery. Excluding the top 15 cases (by resolution value) from the 396 resolved cases, the recovery rate halves to 18 per cent.

“Two, average resolution time for the aforementioned resolved cases is 419 days compared with the stipulated maximum of 330 days. About 75 per cen of outstanding cases have already been pending for more than 270 days,” the study said.

Liquidation: a challenge

Nitesh Jain, Director, Crisil Ratings, noted that besides low recovery rate and longer timeframe, a key challenge is the high number of cases going to liquidation.

“As of June 30, 2021, nearly one-third of the 4,541 admitted cases had gone into liquidation, with a recovery rate estimated at merely 5 per cent.

“That said, around three-fourths of these cases were either sick or defunct. With closure of these vintage cases, recovery rate as well as timelines are expected to improve,”he said.

Notwithstanding these challenges, the IBC has played a key role in resolution of stressed assets so far, according to the study.

“Its effectiveness will continue to be tested given the elevated level of stressed assets in the Indian financial system,” it added.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , ,

Credit Suisse to tighten the reins after string of scandals, BFSI News, ET BFSI

Banking & Finance

[ad_1]

Read More/Less


Credit Suisse will unveil a new centralised structure on Thursday in an attempt to bring its far-flung divisions to heel and draw a line under a string of scandals that have cost the Swiss bank billions of dollars, two sources said.

Over the past year, Credit Suisse has been fined for arranging a fraudulent loan to Mozambique, tarnished by its involvement with defunct financier Greensill, racked up $5.5 billion in losses when U.S. family office Archegos collapsed, and been rebuked by regulators for spying on executives.

Credit Suisse drafted in seasoned banker Antonio Horta-Osorio as chairman in April to stop the rot and he will lay out his charter to reform Switzerland‘s second-biggest bank on Thursday when it presents third-quarter results.

One key change is expected to be the creation of a single wealth management division that caters to a global elite, centralising oversight at the bank’s headquarters in Zurich, two people familiar with the matter told Reuters.

Under the current structure put in place six years ago, wealth management straddles three divisions: a Swiss business, an Asia-Pacific arm catering mainly to rich Chinese and an international arm based out of Switzerland.

Merging the wealth division would make Credit Suisse simpler and potentially pave the way for cost cuts.

It would also rein in local bankers who have enjoyed much autonomy, making them more answerable to senior managers who have often been blindsided by the risks that triggered past scandals, the sources said.

One of the people told Reuters that managers at the bank’s headquarters had become very risk averse and they did not want to give leeway to local bankers, regardless of how much profit they were making.

A spokesman for Credit Suisse declined to comment.

SHARES SUFFER

Credit Suisse’s financial humiliation stands in stark contrast to its cross-town rival UBS.

In the wake of massive losses and a bailout during the financial crisis, UBS successfully pivoted away from investment banking to wealth management and is now the world’s largest wealth manager with $3.2 trillion in invested assets.

Its shares have climbed 57% in the past 10 years while Credit Suisse has slumped 53% over the same period.

Shareholders have deserted Credit Suisse this year following the slew of bad headlines. Its shares are down 12% while UBS is up 36% while Wall Street rivals are riding high on the back of a boom in equity trading and M&A.

Andreas Venditti, an analyst at Swiss private bank Vontobel, said it would take more than “minor changes and a new divisional set-up” at Credit Suisse to reverse the trend.

The expected revamp at Credit Suisse has also encouraged some high-profile dealmakers to approach the bank’s senior management to suggest it merges with a rival, another person with knowledge of the matter said.

Those ideas have been rejected so far, however, the person said.

Nonetheless, the prospect of a challenge by investors demanding the break-up of the bank, or that its shrinking market value makes it a target for a hostile foreign takeover, have long troubled managers, sources told Reuters earlier this year.

‘WARNING SIGNALS’

With a market value of $28 billion, Credit Suisse is worth less than half of UBS and a fraction of Wall Street giants such as JPMorgan weighing in at half a trillion dollars.

But an approach from the United States would not go down well in Switzerland. Relations between Swiss banks and Washington were damaged when the United States pressured them into giving up their strict secrecy code more than a decade ago.

A combination of Credit Suisse and UBS, which has been touted as an alternative alliance, would face its own problems. For one, it would dominate the Swiss market.

Another source said that while Credit Suisse had examined a sale or spin-off of its asset management business, that had been shelved. The person said, however, that once further efforts were made to cut costs and boost growth, a sale, or listing of the business on the market, could be back on the cards.

The bank’s drive to centralise its operations is drawing on lessons from some of its recent failures, including Archegos.

Earlier this year, Credit Suisse published a report blaming a focus on maximizing short-term profits and enabling “voracious risk-taking” by Archegos for failing to steer the bank away from catastrophe.

Despite long-running discussions about Archegos – by far the bank’s largest hedge fund client – Credit Suisse’s top management were apparently unaware of the risks it was taking.

The bank’s chief risk officer and the head of its investment bank recall hearing about it first only on the eve of the fund’s collapse.

“There were numerous warning signals,” the report said. “Yet the business … failed to heed these signs.”



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , ,
1 … 127 128 129 130 131 … 16,280