Axis Bluechip Fund Growth

The fund’s allocation from 80% up to 100% in equities of large-cap companies bears testimony to the focus on high returns regardless of market volatility. In their pursuit to diversify the portfolio to balance asset allocation, the fund also invests in equities and related securities in other companies up to 20%. Besides, similar allocation is explored in cash and money market instruments and units issued by REITs and InvITs with a risk profile ranging from the low to medium.

It is understood that the Axis Bluechip Fund Growth aims at maximum capital appreciation through investments in large-cap companies with proven track record consistent revenue growth and relatively new companies with matching potential. On the flip side, these investments carry very high risks because they are governed by market volatility.  

The portfolio holding pattern as of 31 March 2021 in the percentage of net assets reveals that script of Infosys (9.51), HDFC Bank (9.30), Bajaj Finance Ltd (8.69), Tata Consultancy Services (7.40), Kotak Mahindra Bank (7.14), ICICI Bank (6.28), Avenue Supermarts Ltd (5.60), to name a few, are among the significant portfolio components. Commensurate with the top holdings, the sector-wise allocation is equally revealing. A significant percentage of assets is allocated in Financial Services (40.05), IT (18.16), Consumer Goods (8.85), Pharmaceuticals (5.89), Consumer Services (5.60), and Others (5.57), to name the most dominant.  

The Axis Bluechip Fund-Growth offers the following plans:

• Axis Bluechip Fund-Growth Regular.
• Axis Bluechip Fund-Growth Direct.

There are practically no differences in the two plans, except that the Regular Plan is subscribed at the broker or distributor and the Direct Plan at the Fund House directly without the assistance of any intermediary. However, the financial impact is felt due to the higher Expense Ratio in the Regular Plan due to the outgo on commissions paid to the intermediaries.

Fund Facts

Investment Objective

The Axis Bluechip Fund-Growth allocates assets in a diversified portfolio to large-cap stock companies with potential for high revenue growth. The target stocks are selected to grow earnings from sustainable business models while managing risks in a long-term perspective. The fundamental criterion for stock selection is focused on the capital appreciation potential of individual stocks. The Fund Manager constantly targets to outperform the benchmark by undertaking risk lower than the benchmark. It suits the investors whose risk profile matches that of the fund and aggressively pursues maximum yields regardless of the risk factors. The fund makes every endeavour to realize the objectives, but success is not assured in the face of market volatility. Hence, the Fund House does not guarantee any sustained returns to the investors.

Fund Summary

Axis Bluechip Fund-Growth Regular Plan:

• Risk Level: Very High
• NAV: Rs.40.09 as of 24 May 2021.
• Expense Ratio: 1.7% as of 30 April 2021.
• Fund Started On: 5 January 2010.

Axis Bluechip Fund-Growth Direct Plan:

• Risk Level: Very High
• NAV: Rs.44.25 as of 24 May 2021.
• Expense Ratio: 0.50% as of 30 April 2021.
• Fund Started On: 1 January 2013.

Fund Returns Summary Table: (Performance as of 31 March 2021)

Axis Bluechip Fund-Growth Regular Plan

Axis Bluechip Fund-Growth Direct Plan

Cumulative Pros and Cons Table

Benefits of Axis Bluechip Funds

The Axis Bluechip Fund-Growth is designed to provide investors with long-term capital appreciation to fulfil their aspirations for wealth creation. Investment in large-cap company shares assures stability to the yields because they are traded frequently and are somewhat immune to market volatility to affect their potential at yield generation. It additionally ensures that the investment enjoys extreme liquidity.

• Sustained Performance: The Axis Bluechip Fund-Growth fund investment in large-cap equity and equity-related instruments in companies with a proven track record and revenue-earning business models that are more likely to deliver sustained yields on investment. It also helps the Fund Manager bids to outperform the benchmark index with an eye to higher returns. However, the investor must stay invested for a time horizon exceeding five years to reap the optimal benefits of capital appreciation.  
• Convenience and Transparency: The investor can choose to invest and subscribe to the fund paying in a lump sum or through the SIP route, opening up the scheme even to the small investors. The open-ended Axis Bluechip Fund-Growthfund allows continuous subscription, switch-in and out, and redemption based on the daily NAV. As per SEBI Regulations, NAV must be computed daily and displayed at the Fund House and AMFI portal to ensure transparency and dissemination of information.
• Tax Implications: Earnings through investments in the Axis Bluechip Fund-Growth are subject to compliance with the extant tax laws. As the growth fund plan precludes dividend payment, the investor must cope with Long Term Capital Gains Rules applied to earnings in the following ways.
• If the units are sold after one year from the purchase date, gains up to 1 lacin a financial year are tax-exempt.
• On the other hand, gains above Rs.1 lac in a financial year for units sold after one year from the purchase date are taxed at 10%.
• Gains from the unit sales within one year from the purchase date are taxed at 15%.
• No taxes are applied as long the investor stays invested in the fund.

Fund House Details:

The Axis Bluechip Fund-Growth is governed by the Mumbai Headquartered Axis Asset Management Company Ltd, commonly referred to as the Axis Mutual Fund.  The Fund House launched its first Mutual Fund scheme in October 2009 to grow strongly over the years. Today, it manages about 53 fund schemes with assets valued at over Rs.1.96 lac Crore as of 31 March 2021 in 6 million active accounts spread in 100 locations pan India. The Fund House excels in risk management and planning to instil confidence in the investors with security and future prosperity.

The Axis Asset Management Company Ltd joint venture between Axis Bank Limited and the Shroder Singapore Holdings Private Limited provides quality finance and investment solutions.

As of today, the primary stakeholders of the Axis AMC are:

• Axis Bank Limited - 74.99% holdings:

Axis Bank is one of India’s premier new age private sector banks sponsored by the Unit Trust of India and the Public Sector Life and General Insurance giants, to begin operations in 1994. It has established a strong presence across India, hosting over 4500 branches and 12000 plus ATMs in 2400 locations.

• Shroder Singapore Holdings Private Limited – 25% holdings:

The Shroder Group of Singapore owns the subsidiary excelling in investment management and has been operating in Singapore since 1976. They manage a portfolio of US$20 billion on behalf of their clients comprising institutional and retail investors.

Who Should Invest in Axis Bluechip Fund-Growth?

The Axis Bluechip Fund-Growth primarily aims to generate income and capital appreciation in the long term through sustained investments to large-cap company shares to earn higher returns. The fund carries a very high-risk profile and suits investors with a similar philosophy by its very nature. However, to reap the maximum yields by beating inflation and still creating wealth, the investor must nurse a horizon of five years or more. It can only help achieve long-term goals like children’s education, their future, and the investor’s retirement plans. The following can subscribe to the Axis Bluechip Fund-Growth. The list is only indicative.

• Adult resident individuals, not more than 3
• Minors with sole accounts operated by the natural guardian or the legal guardian.
• Non-Resident Indians and others with similar status on repatriation and non-repatriation basis.
• HUF through its Karta.
• A Partnership including Limited Liability companies.
• Corporate Bodies, Companies, Public Sector Enterprises, and Undertakings.
• Registered Societies, Associations, Charitable Trusts.
• Banks and Financial Institutions.
• Other Mutual Funds, including Axis MF Schemes.
• Indian Armed Forces sponsored entities

Wrapping it up

The Axis Bluechip Fund-Growth provides investors with capital appreciation over a five-year horizon with investments in large-cap equities and related instruments, including derivatives. The fund is rated as very high risk because equity returns are subject to market volatility. However, a diversified portfolio comprising large-cap company stocks with a proven track record and high revenue earning business models somewhat insulates the fund from market turbulence to provide a consistent yield over a long term exceeding five years. The investors are well-advised to weigh the pros and cons before investing in the Axis Bluechip Fund-Growth, where regular dividends are not paid.

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