Axis Mutual Fund has been one of the most reputed asset management companies in India since its launch in the year 2009.

It has over 50 funds to offer, varying across various market caps and type of instruments.

Axis Bluechip Fund has been one of the top performing funds last year. Therefore, in this article we will discuss this fund in detail for our investors.

Let’s begin!

Axis Bluechip Fund – Review

Key Details

Particulars Axis Bluechip Fund
Fund House Axis Mutual Fund
Scheme Open Ended
Class Equity
Inception Date 01/01/2013
Benchmark NIFTY 50 Total Return
NAV (As on 05/02/2019) 29.2
Fund Size 3,737 crores
Minimum SIP Amount 1000
Minimum Lump sum Amount 5000
Expense Ratio 0.89%
Risk Level Moderately High
Fund Managers Shreyash Devalkar
Exit Load Exit Load is 1% if redeemed between 0 to 12 Months
 

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Returns generated by the fund have been shown below:-

Axis Bluechip Fund
Fund Name 1Y 3Y 5Y Expense Ratio Turnover Ratio Category Risk
Axis Bluechip Fund - Direct - Growth 9.33% 17.53% 16.93% 0.89% 171% Equity
(Large Cap)
Moderately High

Portfolio

One of the most critical things that mutual fund investors must focus on while looking for the ideal mutual fund is the portfolio of the respective fund.

We can look at the portfolio by judging two major parts:

  • Top 10 holdings;
  • Allocation

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Top 10 Holdings

Name % of Assets Sector Instrument
HDFC Bank Ltd. 9.8% Financial Equity
Bajaj Finance Ltd. 7.5% Financial Equity
Kotak Mahindra Bank Ltd. 7.1% Financial Equity
Tata Consultancy Services Ltd. 6.1% IT Equity
ICICI Bank Ltd. 5.3% Financial Equity
Maruti Suzuki India Ltd. 4.8% Automobiles Equity
Avenue Supermarts Ltd. 3.8% Services Equity
Hindustan Unilever Ltd. 3.6% FMCG Equity
HDFC Ltd. 3.3% Financial Equity
Titan Company Ltd. 3.1% Consumer Durables Equity

Allocation

We can see that a major part of the fund allocation is to the financial sector (roughly 48 percent). This percentage is allocated amongst top names in this sector such as HDFC Bank, Bajaj Finance, Kotak Mahindra Bank and others.

A few selected stocks had performed well and beaten the markets last year. The fund managers have been able to capitalize on these stocks and therefore, the returns have been better as compared to the benchmark and other funds in the category.

In a recent interview, Mr. Shreyash Devalkar (Fund Manager- Axis Bluechip Fund) was asked about the higher allocation to financials in the fund.

He said that after demonetization, they believed that the financial sector would be a great beneficiary. This was because a huge amount of liquidity flowed into the system resulting in lowering of interest rates and deposits.

The primary call of Mr. Devalkar proved out to be right.

Investment Objective

The investment objective of the fund is to generate long term capital appreciation for investors. It does so by investing in a diversified portfolio predominantly consisting of equity and equity related instruments as well as derivatives.

In Comparison With Other Large-Cap Funds
Fund Name 1Y 3Y 5Y Expense Ratio Turnover Ratio Category Risk
Axis Bluechip Fund - Direct - Growth 9.33% 17.53% 16.93% 0.89% 171% Equity
(Large Cap)
Moderately High
SBI Bluechip Fund - Direct - Growth -5.46% 11.99% 16.31% 1.19% 79% Equity
(Large Cap)
Moderately High
Reliance Large Cap Fund - Direct - Growth -2.48% 16.54% 18.16% 1.2% 85% Equity
(Large Cap)
Moderately High
ICICI Prudential Bluechip Equity Fund - Direct - Growth -2.99% 15.77% 15.56% 1.26% 123% Equity
(Large Cap)
Moderately High
Franklin India Bluechip - Direct - Growth -4.43% 11.93% 13.85% 1.23% 23.83% Equity
(Large Cap)
Moderately High

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Three things stand out about Axis Bluechip Fund in the above table:

  • Returns (especially the last one year returns);
  • Assets under management;
  • Expense ratio

In terms of the last one year returns, Axis Bluechip Fund has been leading amongst all other similar mutual funds.

This fund can truly be called a market-beating fund. This comes because of the heavy reliance on the financial sector as was discussed above.

In terms of AUM size as well, Axis Bluechip Fund is leading the pack. It is seen that as the AUM size starts to increase, it becomes difficult for fund managers to employ excess cash.

Therefore a reasonable size of the AUM is considered better. Axis Bluechip Fund’s AUM is lower as compared to its peers. In fact, the next biggest after Axis Bluechip Fund is that of Franklin India Bluechip Fund which has more than double the AUM of the former.

Expense Ratio

Also one important factor to look into while choosing a fund is expense ratio

This is the ratio which is deducted from the fund as maintenance and fund management fees; meaning lower the expense ratio better it is for us.

Axis Bluechip Fund has the lowest expense ratio amongst its peers. A slight difference in expense ratio can make a huge impact on our returns if we invest for long term.

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Fund Manager Details

Mr. Shreyash Devalkar is the fund manager of Axis Bluechip Fund. He has an experience of more than 18 years.

Education

Mr. Devalkar holds a Bachelor of Chemical Engineering degree from UDCT, Mumbai. He has also earned an MMS in Finance from Jamnalal Bajaj Institute of Management Studies, Mumbai.

Prior Experience

Prior to joining Axis Mutual Fund, Mr. Shreyash Devalkar has worked in the following companies:

  • BNP Paribas (Equity Analyst);
  • IDFC Asset Management Company Limited (Vice President);
  • IDFC Capital Limited (Vice President – Research);
  • JP Morgan Services India Limited (Analyst);
  • Calyon Bank (Manager)

Mr. Devalkar specializes in sectors like technology, telecommunications services, industruals and utilities.

Conclusion

Axis Bluechip Fund has beaten its benchmark index handsomely (both in short term i.e 1 year and also in the long run).

Investors who have a moderate risk appetite and do not want to venture into the small and mid-cap space can surely consider investing in this fund.

Happy Investing!

Disclaimer: The views expressed in this post are that of the author and not those of Groww