Axis ELSS Tax Saver Fund is an open-ended Equity Linked Savings Scheme (ELSS) offered by Axis Mutual Fund, designed to provide long-term capital growth while offering tax benefits under Section 80C of the Indian Income Tax Act.
Key Features:
- Investment Objective: To generate income and long-term capital appreciation from a diversified portfolio predominantly consisting of equity and equity-related securities.
- Lock-in Period: Investments are subject to a mandatory lock-in period of three years, which is one of the shortest among tax-saving instruments.
- Fund Manager: Jinesh Gopani is the current fund manager overseeing the scheme.
- Minimum Investment: A minimum lump sum investment of ₹500 is required, with subsequent investments also starting from ₹500. For Systematic Investment Plans (SIP), the minimum installment is ₹500.
- Expense Ratio: The fund has an expense ratio of 1.55% for the regular plan, as of March 4, 2025.
- Assets Under Management (AUM): As of February 28, 2025, the fund's AUM stands at ₹32,174.34 crore.
Performance:
As of March 18, 2025, the fund's Net Asset Value (NAV) for the Growth option is ₹87.68. The trailing returns over different time periods are:
- 1 Year: 6.84%
- 3 Years: 8.68%
- 5 Years: 13.7%
- Since Inception: 15.14%
These returns are compared to the category averages of 4.66% (1 year), 14.12% (3 years), and 20.16% (5 years).
Portfolio Composition:
The fund maintains a diversified portfolio with the following allocations:
- Equities: Approximately 94.93%
- Debt Instruments: Around 4.36%
- Cash & Cash Equivalents: About 0.71%
The top 10 equity holdings constitute around 36.72% of the assets, with the top three sectors making up approximately 47.18% 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 Axis ELSS Tax Saver Fund through the Axis 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:
Axis ELSS Tax Saver Fund 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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