One of India’s oldest value funds trumps Nifty50 in long-term
27 Aug 2021
The fund had generated annualized returns of 20 per cent since its launch in August 2004 as against Nifty50 TRI’s 15.9 per cent compounded annual returns.
“Global experience has always been that value as a strategy will not work all the time but tends to deliver sizable returns in the long run,” said S Naren, executive director and CIO at ICICI Prudential MF in a press statement celebrating the 17th year of the fund.
Naren, who took over the reins of the fund in January, said that value investing at a time when markets are elevated tends to do well as value focuses on investing in sectors that are out of favour but offer long-term potential.
Over its 17-year run, the scheme has become the largest in its category with assets under management of Rs 21,195 crore and occupies 30 per cent of the AUM of the value schemes category.
“We are happy that through our product offering we have been able to contribute to favourable investment outcomes of wealth creation for our investors over a long term,” said Managing Director and Chief Executive Officer Nimesh Shah.
Over its lifespan, the allocation to largecaps averaged 71.24 per cent while allocations to midcap and smallcap stocks averaged 13.58 per cent and 3.42 per cent, respectively.
A lump-sum investment of Rs 1 lakh in the fund in August 2004 would have yielded the investor around Rs 22 lakh currently. At the same time, a systematic investment plan of Rs 10,000 per month in the scheme from its inception would have yielded a corpus of Rs 1.08 crore.