Introducing Samco ELSS Tax Saver Fund

Samco ELSS Tax Saver Fund aims to outperform benchmark by investing predominantly in high potential mid sized and small sized companies while you avail tax benefits under Section 80C of the Income Tax Act.

elss tax

Source: NGen, as on September 30, 2022

Out of ₹ 150,000 Cr,
₹ 100,000 Cr is in LargeCaps

Even with complete flexibility on market cap allocations, LargeCaps make up 72% (i.e. ₹ 100,000 Cr) of the total AUM (i.e. ₹ 150,000 Cr) of the ELSS category while MidCaps and SmallCaps constitute just 28% of the total.

8% higher returns generated in Nifty MidSmallCap 400

On a rolling returns comparison, a 3-year average rolling return of Nifty MidSmallCap 400 was 48.91%, which is 8% higher than a 3-year average rolling return delivered by Nifty 500, which was 40.92%.

elss tax

Source: NSE since April 01, 2005. Please note that above indicate 3 years rolling return for NIFTY MidSmallCap 400 and NIFTY 500 index from April 01 2005 till October 13 2022. The above returns are of index and do not indicate returns of any scheme. Past performance may or may not sustain in future. MidCap stocks carry a higher risk of market fluctuations and are also prone to higher liquidity risks than LargeCap stocks. Investments in mutual funds should not be construed as a guarantee of any minimum returns & there is no capital protection guarantee.

Over a 3-year period, volatility smoothens significantly

While the volatility in MidCaps may be higher in a shorter horizon of 1 year, it definitely smoothes out when these same stocks are held for a longer time horizon of 3 years, making them suitable for an ELSS scheme with 3-year lock-in period.

elss tax

Source: NSE, Samco Mutual Fund internal research.
Note - Past performance does not guarantee future results.

Key highlights of Samco ELSS Tax Saver Fund

  • Higher potential to generate alpha due to a predominantly MidCap and SmallCap portfolio
  • Higher risks and volatility which can efficiently be managed due to a 3-year lock-in
  • Qualifies for Tax Deduction under Section 80C of Income Tax Act, 1961

Scheme Features

NFO Period
November 15, 2022 to December 16, 2022
Type of scheme
An Open-ended Equity Linked Saving Scheme with a statutory lock-in of 3 years and tax benefit
Investment Objective
The investment objective of the scheme is to generate long-term capital appreciation through investments made predominantly in equity and equity related instruments. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved.
Asset Allocation Pattern
Instruments Indicative allocations (% of net assets) Risk Profile
Minimum Maximum
Equity and Equity related instruments 80% 100% High to Very High
Debt and Money Market instruments 0% 20% Low to Medium
Equity related instruments shall mean equities, cumulative convertible preference shares and fully convertible debentures and bonds of companies. Investment may also be made in partly convertible issues of debentures and bonds including those issued on rights basis subject to the condition that, as far as possible, the non-convertible portion of the debentures so acquired or subscribed, shall be disinvested within a period of 12 (twelve) months. All investments by the Scheme in equity shares and equity related instruments shall only be made provided such securities are listed or to be listed.
Benchmark Index
Nifty 500 Index TRI
Minimum Application Amount
₹ 500 and in multiples of ₹ 500/- thereafter
Entry Load
Not Applicable
Exit Load
Nil
Fund Manager
Ms.Nirali Bhansali

Ms.Nirali Bhansali

Fund Manager - Equity

FAQ’s

What is an Equity Linked Saving Scheme?

Equity Linked Saving Scheme (ELSS), also known as tax-saver fund, is an open ended Equity mutual fund scheme that invest primary in equity related products. However, these ELSS mutual funds have a three-year mandatory lock in term, which is the shortest lock in period if compared to all other products that are available under Section 80C of the Income Tax Act, 1961.

Who should invest in ELSS Tax Saver Fund?

Investors who wish to invest for a minimum of 3 years and are looking for higher return potential, plus the added benefit to save tax under section 80C can invest in ELSS Tax Saver Fund. At the same time, the investors should also prepare for a certain amount of risk attached to it. This is because of the equity exposure in the portfolio. Therefore, ELSS mutual funds are best suited for investors who understand equity asset class risk. These tax saver funds offer higher returns potential when compared to other tax saving schemes.

What are things to consider before investing in ELSS Tax Saver Fund?

The following are the critical factors that must be considered by investors before they invest in ELSS Tax saver fund:

  • Investment horizon: The investor must have a three-year investment horizon to contemplate investing in ELSS funds. To limit market volatility, the equity exposure of ELSS funds necessitates a longer investment horizon.
  • Returns: ELSS funds do not give guaranteed returns as they are wholly dependent on the performance of the underlying securities.
Are ELSS Tax Saver Fund subject to any lock in period?

Yes, ELSS has a lock-in period of three years. This means one cannot withdraw their money before the said tenure ends. However, ELSS has the shortest lock-in period as compared to other similar tax-saving investments currently such as 5-year Fixed Deposits (five years), National Savings Certificate (five years), Public Provident Fund (15 years), etc.

What are the benefits of ELSS Tax Saver Fund?
  • Dual benefit: ELSS funds are the only type of funds in the Indian market, that give the dual benefit of a tax rebate and wealth appreciation. Under Section 80C of the Income Tax Act, 1961, who fall in the higher income tax brackets, can save up to Rs 46,800 in a year if they invest Rs 1.5 lakh per annum in ELSS and are in the 30% income tax bracket. However, Investor will get a maximum tax deduction of Rs 1.5 lakh per year in ELSS under Section 80C even if they invest more than this amount.
  • Shortest lock-in: Currently, ELSS has the shortest lock-in period of three years under Section 80C of Income Tax Act 1961.
  • Potentially higher returns: Unlike ELSS where return is market linked, other 80C investments like PPF or FDs are fixed income products. ELSS has the potential to generate significantly higher wealth in a medium to long-term investment horizon.
Is returns from ELSS tax free?

The redemption proceeds of ELSS are not entirely tax-free. The long-term capital gains of up to Rs 1,00,000 a year are tax-free, and any gains above this limit attract a long-term capital gains tax at the rate of 10% plus applicable cess and surcharge.

What is the objective of SAMCO ELSS Tax Saver Fund?

The investment objective of the scheme is to generate long-term capital appreciation through investments made predominantly in equity and equity related instruments. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved.

Where will SAMCO ELSS Tax Saver Fund invest?

The Fund’s strategy will endeavor to have a predominantly higher allocation to mid and small cap companies which will be selected through focusing on the fundamentals of the business, the industry structure, the quality of management, sensitivity to economic factors, the financial strength of the company and the key earnings drivers. The scheme will invest in about 30-40 scripts to ensure adequate diversification and reduced risk.

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Disclaimer

Welcome to www.samcomf.com, the website of Samco Asset Management. Please read this information carefully. Access to this website is confirmation that you understand and agree to be bound by all of these Terms and Conditions.

The information and data contained in this Website do not constitute distribution, an offer to buy or sell or solicitation of an offer to buy or sell any Schemes/Units of Samco Mutual Fund in any jurisdiction in which such distribution, sale or offer is not authorised. The material/information provided on this website is for the limited purposes of information only for the investors. Read more

This product is suitable for investors who are seeking* :
Risk-o-meter
Investors understand that their principal will be at very high risk
  • Long Term Capital Appreciation
  • Invests predominantly in equity and equity related instruments and provide tax benefits under Section 80C of the Income Tax Act, 1961

**Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

(The product labelling assigned during the New Fund Offer is based on internal assessment of the Scheme Characteristics or model portfolio and the same may vary post NFO when actual investments are made)

Mutual fund investments are subject to market risks, read all scheme related documents carefully.

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