Kotak Small Cap Fund Direct Growth

Kotak Small Cap Fund is a mutual fund scheme that invests in stocks of small companies. Small cap firms generally have a market cap of below Rs 5,000 crore and have companies that might have large growth potential but also come with significant risk as they are more susceptible to macro economic changes.

Since small-cap companies are relatively lesser-known and are considered as high-risk investments. Nesco, Thyrocare, Delta Corp are examples of small cap firms.

While some small cap stocks do provide the opportunity to earn bumper returns, it's important to note that investing in small-cap stocks comes with higher risks, as these companies are more vulnerable to economic downturns and market fluctuations, making investing in this fund suitable to investors who have a higher risk taking ability.

1. Kotak Small Cap Fund Direct Growth has ₹16450 Cr worth of assets under management (AUM) as on Jan 2025 and is more than category average.
2. The fund has an expense ratio 0.6.
   

Kotak Small Cap Fund Direct Growth has given a CAGR return of 19.30% since inception. Over the last 1, 3 and 5 years the fund has given a CAGR return of 1.51%, 14.18% and 25.14% respectively.

Kotak Small Cap Fund Direct Growth has allocated its funds majorly in Cash Equivalent, Industrial, Consumer Cyclical, Health, Basic Materials, Real Estate, Financial Services, Consumer Defensive, Communication, Tech. Its top holdings are Century Plyboards (India) Ltd, Cyient Ltd, Vijaya Diagnostic Centre Ltd, Aster DM Healthcare Ltd Ordinary Shares, Krishna Institute of Medical Sciences Ltd

As it is a small-cap mutual fund the taxation is as follows:
For short term (less than a year) capital gains will be taxed at 20%
For long term (more than 1 year) capital gains will be taxed at 12.5% without indexation benefit
Dividends will always be taxed at slab rate. Long term gains upto Rs 1 lakh are exempt capital gains tax.

The investment objective of the scheme is to generate capital appreciation from a diversified portfolio of equity and equity related securities by investing predominantly in small cap companies. There is no assurance that the investment objective of the Scheme will be achieved.

Minimum investment for lump sum payment is INR 100.00 and for SIP is INR 100.00. Kotak Small Cap Fund Direct Growth has no lock in period.