Mutual fund investment: This fund turned Rs 1,000 SIP into Rs 1.4 crore in 32 years; check details

The SBI Long Term Equity Fund, formerly known as the SBI Magnum Taxgain Scheme, is an Equity Linked Savings Scheme (ELSS) offered by India's largest fund house. With a history of 32 years, this tax-saving fund is one of the oldest of its kind in India, featuring a 3-year lock-in period and tax benefits for investors. By investing Rs 1,000 every month through a Systematic Investment Plan (SIP) in this scheme, an investor could have accumulated a fund value exceeding Rs 1.5 crore.

Launched on March 31, 1993, the fund initially offered the IDCW Option (previously Dividend Option), with the Growth Option being introduced later on May 7, 2007. The scheme is benchmarked against the BSE 500 TRI index, providing investors with a reliable reference point for their investment performance analysis.

Fund details

The assets under management (AUM) of this scheme have grown to Rs 27,730.33 crore as of March 31, 2025. Dinesh Balachandran has been the fund manager of this scheme since September 2016. The scheme predominantly invests in equity and equity-related instruments, with over 90% allocation, while allocating up to 10% in money market instruments.

The scheme has leveraged consistent equity investments to capitalise on market opportunities, turning modest monthly contributions into substantial wealth. Over the years, this approach has proven beneficial, especially during periods of economic growth, solidifying the scheme's position as a viable option for long-term investors seeking sustained growth.

The NAV of SBI Long Term Equity Fund Direct Plan-Growth as of 03/04/2025 stands at Rs 437.78, with an expense ratio of 0.95%, in line with industry standards. Over the past year, the fund has yielded returns of 7.79%, while since inception, it has delivered an average annual return of 16.43%, doubling investors' money every 3 years.

The fund primarily allocates its assets to the Financial, Technology, Energy, Healthcare, Metals & Mining sectors. The top 5 holdings of the fund include HDFC Bank Ltd., Reliance Industries Ltd., ICICI Bank Ltd., Bharti Airtel Ltd., and Hexaware Technologies Ltd.

SIP calculations

The SIP of Rs 1,000 per month has achieved remarkable growth, amounting to Rs 1.4 crore over 32 years. This achievement demonstrates the effectiveness of long-term investment strategies and the power of compounding returns in the mutual fund industry.

SIP Returns of SBI Long Term Equity Fund - Regular Plan

Upfront Investment: Rs 1 lakh
Monthly SIP Amount: Rs 10,000
Investment Duration: 3 years
Total investment: Rs 4,60,000 invested across 3 years.
Annualised returns: Rs 6,65,578 at 20.93% annualised returns

Peer comparison

Equity-Linked Savings Schemes (ELSS) are tax-saving mutual funds available in India. They primarily invest in the stock market, providing the opportunity for capital appreciation and tax advantages under Section 80C of the Income Tax Act. ELSS funds come with a mandatory 3-year lock-in period.