Aditya Birla Sun Life Tax Relief 96 is an open-ended Equity Linked Savings Scheme (ELSS) that offers investors the dual benefit of potential long-term capital appreciation and tax savings under Section 80C of the Income Tax Act, 1961.
Key Features:
- Investment Objective: The scheme aims to achieve long-term growth of capital through a diversified portfolio with a target allocation of 80% equity and 20% debt and money market securities.
- Lock-in Period: Investments are subject to a mandatory lock-in period of three years, which is among the shortest durations compared to other tax-saving instruments.
- Fund Managers: The fund is managed by Dhaval Shah and Dhaval Joshi, both of whom have extensive experience in equity research and investments.
- Minimum Investment: The minimum lump sum investment required is ₹500, with additional investments also starting from ₹500. For Systematic Investment Plans (SIP), the minimum installment is ₹500.
- Expense Ratio: As of January 20, 2025, the expense ratio for the regular plan is 1.7%.
- Assets Under Management (AUM): The fund's AUM stands at ₹14,626.04 crore as of January 31, 2025.
Performance:
As of March 3, 2025, the fund's Net Asset Value (NAV) for the Growth option is ₹51.49. The trailing returns over different time periods are:
- 1 Year: 1.33%
- 3 Years: 9.42%
- 5 Years: 10.34%
- Since Inception: 20.96%
In comparison, the category returns for the same durations are 0.61% (1 year), 13.23% (3 years), and 17.16% (5 years).
Portfolio Composition:
The fund maintains a diversified portfolio with the following allocations:
- Equities: Approximately 98.02%
- Cash & Cash Equivalents: About 1.98%
The top 10 equity holdings constitute around 39.37% of the assets, with the top three sectors making up approximately 45.88% of the assets.
Tax Implications:
- Tax Benefits: Investments qualify for deductions under Section 80C, up to ₹1.5 lakh per financial year.
- Capital Gains Tax: Long-term capital gains exceeding ₹1 lakh are taxed at 10% without the benefit of indexation.
- Dividend Distribution Tax: Dividend income is added to the investor's income and taxed according to the applicable tax slab. Additionally, if dividend income exceeds ₹5,000 in a financial year, a TDS of 10% is deducted by the fund house.
Risk Level:
The fund is categorized under the 'Very High' risk category, indicating that it is suitable for investors with a high-risk appetite seeking long-term capital appreciation.
How to Invest:
Investors can invest in the Aditya Birla Sun Life Tax Relief 96 through the Aditya Birla Sun Life Mutual Fund website or other mutual fund distribution platforms. The process typically involves selecting the fund, choosing the investment amount, and completing the necessary KYC formalities.
Conclusion:
Aditya Birla Sun Life Tax Relief 96 offers investors an opportunity to participate in equity markets while availing tax benefits. However, considering its high-risk category and equity exposure, it is best suited for investors with a long-term investment horizon and a high-risk tolerance.
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