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Best Value Mutual Funds

Value funds invest in stocks that are deemed to be undervalued in prices based on fundamental characteristics. They are open-ended equity schemes that follow a value investment strategy. This kind of fund invests in the shares of companies that are traded at discounted rates, and the primary reason for investors to choose these stocks is that they could be undervalued due to temporary factors but can give high returns in the long run. 

It is essential to note that value funds are often misunderstood to be contra funds. Contra funds aim at identifying stocks that are temporarily out of favour, whereas value funds concentrate on stocks trading below their intrinsic value. You can have a look at some of the best value funds in the table below.

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List of Value Mutual Funds in India

Fund NameCategoryRisk1Y ReturnsRatingFund Size(in Cr)
ICICI Prudential Value Discovery Fund
EquityVery High43.1%5₹45,470
JM Value Fund
EquityVery High62.9%4₹839
HSBC Value Fund
EquityVery High53.8%4₹13,357
Bandhan Sterling Value Fund
EquityVery High39.5%4₹9,756
Templeton India Value Fund
EquityVery High46.7%3₹2,137
Tata Equity PE Fund
EquityVery High47.1%3₹8,483
Nippon India Value Fund
EquityVery High51.3%3₹8,187
ITI Value Fund
EquityVery High51.1%3₹262
Union Value Fund
EquityVery High41.4%3₹265
Union Value Discovery Fund
EquityVery High34.3%3₹199
UTI Value Fund
EquityVery High11.2%3₹7,641
HDFC Capital Builder Value Fund
EquityVery High44.4%2₹7,313
UTI Value Fund
EquityVery High44.5%2₹9,902
Quantum Long Term Equity Value Fund
EquityVery High40.3%2₹1,163
DSP Value Fund
EquityVery High36.7%2₹842
View All

Who Should Invest in Value Funds?

Value funds are likely to be suitable for-

  1. Long Term Investors

Fund managers pick these stocks to see them grow over time and in the future, which means you will have to stay invested in the funds for the long term to witness the true growth potential. Therefore, investors with a longer investment horizon can prefer investing in them. 

  1. Investors Already Holding Growth Stocks

Value funds can provide solid returns in any market cycle for investors who have high exposure to growth stocks. 

  1. Investors with a High-Risk Appetite

These funds’ performance may or may not improve in the future. Investors who are open to both the outcomes and have risk-bearing ability can start investing in value funds.

If you are investing lumpsum in mutual funds and looking forward to estimating your returns, simply use lumpsum calculator. It is a convenient tool that can assist you in generating your prospective returns.

Factors to Consider While Investing in Value Mutual Funds

There are certain factors to be considered before making investments in the top value mutual funds, and they are:

  1. Past Performance: You will have to look at the past performance of the fund, mostly a period of 5 to 7 years, which is critical with a value fund. It assists in the analysis of how the fund manager has been moving towards the investment objective across the market cycle while following the value investing strategy.
  2. Investment Horizon: Before an investor decides to find the best value funds to invest in 2024, it is noteworthy to remember that these funds are best suited for investors who have a long-term investment tenure in mind. They need to stick to their investment horizon. It can help them to get significant returns on the investment. 
  3. Expense Ratio: Just like other categories of mutual funds, this kind of fund also has an expense ratio. It is the fee charged for managing your investment. If the fund manager tends to change the portfolio often, it can result in higher transaction costs. Therefore, it is essential for an investor to look at this factor before choosing an investment. 
  4. Risk: All mutual fund investments are market-linked and carry some amount of risk. Value funds, too, face risks based on market conditions. It is essential to look into the fund and whether or not the fund manager is managing the asset allocation to benefit from the dynamic market. 

Major Advantages

Here are some benefits of investing in the best value mutual funds:

Portfolio diversification: Value funds invest in undervalued stocks across different sectors. It helps in diversifying a portfolio with limited exposure to options with a significant risk-reward ratio. 

Lower downside risk: The downside risk and the level of volatility in the case of value mutual funds is lower when compared with other types of equity funds. Since these stocks are already undervalued, they are less impacted in a bearish market

High-growth potential: Value funds have the potential to multiply investors’ wealth significantly and maximise portfolio value over the long term. 

Investment route: Investors can allocate their savings to mutual funds via two modes, namely lump sum and systematic investment plan (SIP). The first route allows individuals to invest the entire amount in one go. By opting for the SIP mode, they can invest in a value fund via fixed instalments at regular intervals (monthly, quarterly, yearly, etc.). While individuals need to invest at least Rs.1,000 if they opt for the lump sum route, they can start a SIP with Rs.100. Note that this minimum amount may vary from one scheme to another.

Risks Involved While Investing in Value Funds

The risks to consider while selecting the best value mutual funds for 2024 are-

  1. Holding Periods: For value investing strategies, the stock price discovery can take longer than estimated. The fund manager chooses low-price stocks, and they can turn around in several years. At the same time, some stocks can multiply faster in the short term. 
  2. Underperformance: At times, value stocks do not perform based on the estimations, which can further take a hit on your investment portfolio. 

FAQs

Q1. What is meant by value funds?

Value funds are equity mutual funds adopting a value investing strategy. The fund manager will invest in undervalued stocks that tend to trade below the intrinsic value. 

Q2. Is it a good choice to invest in value funds?

They do carry a certain amount of risks, but these funds are known to outperform growth funds when strategised right.

Q3. Who should invest in value funds?

Value funds are appropriate for long-term investors hoping to diversify their holdings. Investors with a lengthy investment horizon may be interested in them since they invest in underperforming assets but are expected to outperform in the long run.

Q4. What is the major benefit of a value fund?

The major benefits of these funds are that they help to diversify the investor's portfolio and, over time, provide good returns. 

Q5. What kind of risks do value funds have?

Value funds come with several risks, such as underperformance and inaccurate analysis of the fund manager, which can, in turn, result in downturns in your investment. 

Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.

 

Let's have a closer look

Now let us jump and check about these top 15 mutual fund schemes.

ICICI Prudential Value Discovery Direct Growth

Fund Performance: The ICICI Prudential Value Discovery Fund has given 27.68% annualized returns in the past three years and 26.21% in the last 5 years. The ICICI Prudential Value Discovery Fund comes under the Equity category of ICICI Prudential Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in ICICI Prudential Value Discovery Fund via lump sum is ₹1,000 and via SIP is ₹100.

Min Investment Amt₹1,000
AUM₹45,470Cr
1Y Returns43.1%

JM Value Fund Direct Plan Growth

Fund Performance: The JM Value Fund has given 31.4% annualized returns in the past three years and 29.05% in the last 5 years. The JM Value Fund comes under the Equity category of JM Financial Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in JM Value Fund via lump sum is ₹1,000 and via SIP is ₹100.

Min Investment Amt₹1,000
AUM₹839Cr
1Y Returns62.9%

HSBC Value Fund Direct Growth

Fund Performance: The HSBC Value Fund has given 27.75% annualized returns in the past three years and 26.46% in the last 5 years. The HSBC Value Fund comes under the Equity category of HSBC Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in HSBC Value Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹13,357Cr
1Y Returns53.8%

Bandhan Sterling Value Fund Direct Plan Growth

Fund Performance: The Bandhan Sterling Value Fund has given 24.75% annualized returns in the past three years and 27.41% in the last 5 years. The Bandhan Sterling Value Fund comes under the Equity category of IDFC Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Bandhan Sterling Value Fund via lump sum is ₹1,000 and via SIP is ₹100.

Min Investment Amt₹1,000
AUM₹9,756Cr
1Y Returns39.5%

Templeton India Value Fund Direct Plan Growth

Fund Performance: The Templeton India Value Fund has given 28.27% annualized returns in the past three years and 26.6% in the last 5 years. The Templeton India Value Fund comes under the Equity category of Franklin Templeton Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Templeton India Value Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹2,137Cr
1Y Returns46.7%

Tata Equity PE Fund Direct Growth

Fund Performance: The Tata Equity PE Fund has given 26.64% annualized returns in the past three years and 23.73% in the last 5 years. The Tata Equity PE Fund comes under the Equity category of Tata Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Tata Equity PE Fund via lump sum is ₹5,000 and via SIP is ₹100.

Min Investment Amt₹5,000
AUM₹8,483Cr
1Y Returns47.1%

Nippon India Value Fund Direct Growth

Fund Performance: The Nippon India Value Fund has given 25.41% annualized returns in the past three years and 25.85% in the last 5 years. The Nippon India Value Fund comes under the Equity category of Nippon India Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Nippon India Value Fund via lump sum is ₹500 and via SIP is ₹100.

Min Investment Amt₹500
AUM₹8,187Cr
1Y Returns51.3%

ITI Value Fund Direct Growth

Fund Performance: The ITI Value Fund comes under the Equity category of ITI Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in ITI Value Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹262Cr
1Y Returns51.1%

Union Value Fund Direct Growth

Fund Performance: The Union Value Fund has given 23.02% annualized returns in the past three years and 23.24% in the last 5 years. The Union Value Fund comes under the Equity category of Union Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Union Value Fund via lump sum is ₹1,000 and via SIP is ₹500.

Min Investment Amt₹1,000
AUM₹265Cr
1Y Returns41.4%

Union Value Discovery Fund Direct Growth

Fund Performance: The Union Value Discovery Fund has given 22.8% annualized returns in the past three years and 19.32% in the last 5 years. The Union Value Discovery Fund comes under the Equity category of Union Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Union Value Discovery Fund via lump sum is ₹1,000 and via SIP is ₹1,000.

Min Investment Amt₹1,000
AUM₹199Cr
1Y Returns34.3%

UTI Value Fund Direct Growth

Fund Performance: The UTI Value Fund has given 22.33% annualized returns in the past three years and 15.8% in the last 5 years. The UTI Value Fund comes under the Equity category of UTI Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in UTI Value Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹7,641Cr
1Y Returns11.2%

HDFC Capital Builder Value Fund Direct Plan Growth

Fund Performance: The HDFC Capital Builder Value Fund has given 22.95% annualized returns in the past three years and 21.96% in the last 5 years. The HDFC Capital Builder Value Fund comes under the Equity category of HDFC Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in HDFC Capital Builder Value Fund via lump sum is ₹100 and via SIP is ₹100.

Min Investment Amt₹100
AUM₹7,313Cr
1Y Returns44.4%

UTI Value Fund Direct Growth

Fund Performance: The UTI Value Fund has given 21.17% annualized returns in the past three years and 23.36% in the last 5 years. The UTI Value Fund comes under the Equity category of UTI Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in UTI Value Fund via lump sum is ₹5,000 and via SIP is ₹500.

Min Investment Amt₹5,000
AUM₹9,902Cr
1Y Returns44.5%

Quantum Long Term Equity Value Fund Direct Growth

Fund Performance: The Quantum Long Term Equity Value Fund has given 19.64% annualized returns in the past three years and 18.79% in the last 5 years. The Quantum Long Term Equity Value Fund comes under the Equity category of Quantum Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in Quantum Long Term Equity Value Fund via lump sum is ₹500 and via SIP is ₹500.

Min Investment Amt₹500
AUM₹1,163Cr
1Y Returns40.3%

DSP Value Fund Direct Growth

Fund Performance: The DSP Value Fund comes under the Equity category of DSP Mutual Funds.

Minimum Investment Amount: The minimum amount required to invest in DSP Value Fund via lump sum is ₹100 and via SIP is ₹100.

Min Investment Amt₹100
AUM₹842Cr
1Y Returns36.7%

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