Crorepati formula: Rs 10,000 SIP for 19 years can give you Rs 1.60 crore

MF investment: Mutual fund investment in 2024 is being considered a prudent financial tactic for numerous reasons. Diversification is a pivotal factor, especially in today's erratic global economy. The practice of spreading investments among different asset classes, including stocks, bonds, and commodities, is essential for risk reduction. Mutual funds deliver immediate diversification by combining investors' funds and distributing them across a spectrum of securities.

Most investors aspire to accumulate a coffer of more than Rs 1 crore for their retirement or other life goals. There are many mutual fund schemes that have delivered good returns and given more than Rs 1 crore to its investors. 

By investing Rs 10,000 monthly in the Aditya Birla Sun Life India GenNext Fund, one can potentially accumulate a sum of Rs 1.60 crore over a period of 19 years. This open-ended equity fund, established in August 2005, focuses on the theme of consumption, taking advantage of factors such as India's expanding workforce, increasing income levels, and growing high-value spending habits.

Additionally, an initial lump sum investment of Rs 1 lakh made at the fund's inception has now grown to Rs 22.35 lakh. The fund has demonstrated consistent growth, with compounded annual growth rates (CAGR) of 17.68% over 1 year, 22.38% over 3 years, and 18.84% over 5 years. It is worth noting that the fund has surpassed its benchmark, the NIFTY India Consumption TRI, which recorded a 3-year return of 21.78%.

The Aditya Birla Sun Life India GenNext Direct Fund-Growth, managed by Aditya Birla Sun Life Mutual Fund, is a thematic-consumption mutual fund with assets under management (AUM) totaling Rs 6,011 Crores as of September 30, 2024.

The scheme focuses on investing in equity or equity-related instruments of companies that are projected to capitalize on the increasing consumer trends in India, fueled by the substantial disposable incomes of the younger generation (Generation Next). This scheme primarily allocates funds to sectors such as Consumer Staples, Financial, Services, Automobile, and Consumer Discretionary. It distinguishes itself by maintaining lower exposure to Consumer Staples and Financial sectors compared to its peers in the same category.

The fund’s portfolio consists primarily of domestic equities, with a heavy allocation of 98.29%. Within this allocation, 51.69% is in Large Cap stocks, 23.95% is in Mid Cap stocks, and 4.52% is in Small Cap stocks. The fund's top 5 holdings include ITC Ltd., Bharti Airtel Ltd., ICICI Bank Ltd., Trent Ltd., and HDFC Bank Ltd., reflecting its strategic investment approach.

Period       This fund    Category average
6 months   21.38%    22.57%
1 year       41.13%    44.66%
3 years       18.68%    21.85%
5 years       23.23%    24.2%
10 yrs       19.21%    17.96%

Disclaimer: Business Today provides market and mutual fund news for informational purposes only and should not be construed as investment advice. All mutual fund investments are subject to market risks. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.