L&T India Value Fund: Fund Review

When there is high level of uncertainty and a small universe of investible ideas, it makes sense to follow what has worked in the long-term. One of the time-tested strategies which has worked in extremely uncertain times is value investing.

Value investing works not only when there is uncertainty in domestic markets but also in global markets. The strategy is all about spotting companies whose fundamentals remain strong but they are trading cheaper than their historical average valuation. This means looking at companies which are trading below their intrinsic value.

One such scheme which follows the concept of value investing to a reasonable extent is L&T India Value Fund. Scheme’s fund manager Venugopal Manghat has constructed quite a diversified portfolio with top five stocks amounting to 27% of the portfolio. Even in terms of sectors, the scheme’s exposure to top three sectors is 55.6%. This provides high scope for spotting value investments across sectors. In the past three-year and five-year, the scheme has delivered 12.4% and 18.4%, respectively, while its peers have given average returns of 11% and 14.1%, respectively.


Portfolio change (past 6 months)

New Entrants	Complete exits	Increase in allocation
Bank of Baroda	Chola Financial Holdings	HDFC Bank
Chola Investment & Fin	Karur Vysya Bank	Emami
Cummins India	Tata Chemicals	The Indian Hotels Co

Returns (in %)

Period	CAGR Return	SIP CAGR Return	Value Fund - Average CAGR Return
1 Year	-7.86	-3.80	-7.22
3 Year	12.14	3.15	11.14
5 Year	18.44	9.35	14.51

Peer comparison returns (in %)

Scheme	1-year	3-year	5-year
Invesco India Contra Fund	-3.50	14.71	17.67
Kotak India EQ Contra Fund	3.17	15.15	13.15
Tata Equity PE Fund	8.82	15.56	16.78

Source: Accord Fintech, Complied by ETIG Database

Expert Take
Harshvardhan Roongta, CFP, Roongta Securities
A well diversified multi-cap fund investing in stocks which are trading below their fair values. In volatile markets, value investing ensures investments are not made in momentum stocks. L&T India Value Fund is one of the most consistent performer in its category and investors can invest with a minimum time horizon of five years enabling market cycles to work in their favour.