Tax Savior - Wealth Creator

 

While some people are comfortable handling their own investments, many are not. Indian investors are already struggling between the 8-10% interest rates from the bank which merely beats the inflation.  If the long term goals are taken into consideration, then the below mentioned ELSS fund can prove to be one of the best in the basket. It simply saves tax up to Rs.1,50,000 and also manages to outperform the benchmark returns.

Individual investors are facing many emotional and financial conflicts which if left unresolved could put their future at risk. When there is no time to monitor the investments and lack of expertise, under such circumstances mutual funds come into picture directly cutting the confusion. If goals are clear with unique objectives then it is our responsibility to help you make more assured decisions about your financial future.

Birla Sun Life Tax Relief 96 – Growth Weekly Chart

Birla Sun Life Tax Relief 96 is an open ended Equity Linked Saving Scheme (ELSS) with 98.61% exposure to equity.

Portfolio Analysis: The fund aims to generate returns by investing in complete equity with maximum exposure to Banking/Finance and Automotive sector.

Sector Allocation:

Sector         % Banking and Finance 19.90 Automotive 16.85 Pharmaceuticals 9.18 Miscellaneous 6.13 Chemicals 6.11 Returns as on 19th October 2016

Period Returns (%) 1 year 12.91 3 year 27.41 5 year 20.08

Top Stock Holdings

Company	PE	% Assets
Sundaram-Clayto	52.29	6.81
Bayer Crop Science	48.94	5.10
Honeywell Automation	57.81	4.81
Kotak Mahindra Bank	35.71	3.89
ZEE Entertainment	48.79	3.88

Risk Profile: This fund is considered as “High Risk Fund” due to complete exposure to equity instruments, therefore it’s suitable for investors who are looking for Tax benefits.

Taxation Perspective: Birla Sun Life Tax Relief 96 is ELSS fund is where investor is eligible for tax exemptions up to 150,000 INR under section (u/s) 80C of the Indian Income Tax Act, 1961 if they stay invested for three years or more. ELSS Funds are also eligible for Long Term Capital Gains which will be treated tax free as the holding will be more than one year. The Dividend earned from ELSS funds is also treated as tax free.

Investment Rationale: Birla Sun Life Tax Relief 96 fund has shown some outperformance despite of no clear trend in the Indian Equity Markets.  We can expect the same in this fund to continue for next few weeks and one leg is still pending on downside which should provide excellent buying opportunities for lump sum investors.

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