Canara Robeco Bluechip Equity Fund: Capitalizing on Market Leaders

Jul 30, 2020

Listen to Canara Robeco Bluechip Equity Fund: Capitalizing on Market Leaders

00:00 00:00

Our buying decisions are often influenced by brand popularity. When it comes to investing in mutual funds, many of us prefer funds that have wide acceptance. However, you would be surprised to know, some of the popular schemes that have completed a long-term track record underperformed the benchmark index as well as the category average returns.

On the contrary, some small-sized, undiscovered funds have the potential to generate superior returns as compared to their large-sized peers. Therefore, it is important to judge mutual funds based on various quantitative and qualitative parameters rather than popularity.

Canara Robeco Bluechip Equity Fund (CRBEF) is one such less known fund that has clearly beaten its giant-sized peers in the recent crash and showcased its high growth potential over the last one year.

Graph 1: Growth of Rs 10,000 if invested in Canara Robeco Bluechip Equity Fund 5 years ago

CRBEF has been an average-performing large cap fund that remained mute for a major tenure of its existence, and managed to deliver returns just in line with the category average. However, the fund’s strategy of sticking to index heavy weights that have been driving the index over the last couple of years has turned in its favour and paid-off investors with superior returns. In the recent market crash, the fund managed to limit the downside, generating noticeable alpha over the index, and improved its overall performance as well. Over the last 5-year period, CRBEF has registered a compounded annualised return of around 9.5%, as against 7.2% CAGR delivered by its benchmark S&P BSE 100 – TRI index. Clearly, CRBEF’s recent extra-ordinary performance, supported by its ability to manage downsides, helped it find a space in the list of top category performers.

Graph 1
Data as on July 29, 2020
(Source: ACE MF)

Table: Canara Robeco Bluechip Equity Fund's performance vis-à-vis category peers

Scheme Name Corpus (Cr.) 1 Year (%) 2 Year (%) 3 Year (%) 5 Year (%) 7 Year (%) Std Dev Sharpe
Axis Bluechip Fund 14,522 6.42 4.44 10.46 10.33 14.77 17.12 0.102
Canara Rob Bluechip Equity Fund 533 11.11 5.92 8.73 9.44 13.58 18.48 0.072
BNP Paribas Large Cap Fund 782 6.26 4.98 5.92 7.19 14.33 18.42 0.025
Edelweiss Large Cap Fund 177 4.47 0.68 5.66 7.20 12.74 20.36 0.030
Invesco India Largecap Fund 208 4.64 0.60 5.08 7.74 13.70 20.05 0.019
Mirae Asset Large Cap Fund 16,381 1.49 2.51 5.06 9.44 17.01 21.02 0.025
JM Large Cap Fund 513 6.98 3.75 4.41 5.86 11.85 9.80 -0.029
IDFC Large Cap Fund 439 6.02 0.91 4.35 7.58 10.89 19.74 0.003
Kotak Bluechip Fund 1,502 4.97 1.42 4.35 7.03 12.86 20.98 0.008
LIC MF Large Cap Fund 336 2.71 1.34 3.89 5.77 11.87 18.51 0.004
S&P BSE 100 - TRI 1.01 0.04 4.05 7.19 11.42 21.14 0.012
Returns are point to point and in %, calculated using Direct Plan - Growth option. Those depicted over 1-Yr are compounded annualised.
Data as on July 29, 2020
(Source: ACE MF)
*Please note, this table only represents the best performing funds based solely on past returns and is NOT a recommendation. Mutual Fund investments are subject to market risks. Read all scheme related documents carefully. Past performance is not an indicator for future returns. The percentage returns shown are only for indicative purposes.

CRBEF's high growth potential is clearly visible in the performance table above. The superior performance registered by the fund over the last year has helped improve its overall returns as well. With this the fund has achieved a mark of significantly outpacing the benchmark and prominent category peers across time periods. Axis Bluechip Fund, BNP Paribas Large Cap Fund, and Edelweiss Large Cap Fund are some of the other top performers in the category.

This outperformance has come at a far reasonable risk when compared to the benchmark and category average. The fund's Standard Deviation (18.48%, annualised) is much lower than its benchmark (21.14%, annualised) as well as the category average. In terms of risk-adjusted returns (as denoted by the Sharpe), CRBEF has shown significant, thus outperforming its benchmark as well as the category average by a noticeable margin.

Investment strategy of Canara Robeco Bluechip Equity Fund

Categorised under large cap funds, CRBEF is mandated to invest a minimum 80% of its assets in large-cap stocks. Accordingly, it focuses on bluechip companies and invests in stocks of companies figuring in the list of top 100 companies, based on market capitalisation.

While selecting stocks for the portfolio, the fund focuses on companies and sectors that are expected to perform better than the general market and uses inputs from an internal quant model to identify investable companies. The fund follows a blend style of investing, i.e. it looks for high growth stocks available at fair valuation and stays invested for the long term.

The fund manager aims to invest in large sized companies with an established business presence, good reputation and solid brand equity. CRBEF usually holds about 35-40 stocks in its portfolio and follows a buy and hold investment strategy, which reflects the strong long-term conviction the fund management has when it picks stocks for the portfolio.

Graph 2: Top portfolio holdings in Canara Robeco Bluechip Equity Fund

Graph 2 Graph 2
Holding in (%) as on June 30, 2020
(Source: ACE MF)

CRBEF usually holds a fairly-diversified portfolio of about 35 to 40 stocks. As on June 30, 2020, the fund held 41 stocks in its portfolio spread across sectors. The top 10 stock holdings accounted for about 49.3% of the portfolio. Index heavyweights like HDFC Bank, Reliance Industries, Infosys, and ICICI Bank currently find place in the top 5 portfolio holdings.

In the last one year, the fund benefitted immensely from its holdings in Abbott India, Reliance Industries, Bharti Airtel, Dr Reddy's Lab, Divi's Lab, Nestle India, HUL, etc. However, stocks like L&T, Axis Bank, ICICI Bank, HDFC Bank, ITC, HDFC, etc. eroded some of its gains.

Among sector holdings, CRBEF's portfolio has major exposure to Banking and Finance with a combined allocation of about 30%. Additionally, it has other prominent sectors such as, Consumption, Infotech, Pharma, Petroleum, Auto and Telecom in the portfolio with an exposure of approximately 5% to 15% in each one.


CRBEF has evolved in terms of performance by distinctly outperforming the benchmark, as well as most of its large-sized peers even in depressing conditions. This gives investors the confidence of investing in the fund for the long term. Backed by well-defined investment process, CRBEF has the ability to timely pick quality names having high growth potential, and deliver market-beating returns in the long run at a reasonable level of risk.

However, its high concentration towards few sectors can add to volatility in the short term. It is suitable for long-term investors having preference for stability of large caps along with potential to generate decent alpha in terms of returns.


Warm Regards,
Divya Grover
Research Analyst


Editor's note: The last few years have not been among the best for equity mutual funds. While most funds have underperformed or are struggling to match the returns of the benchmark, there are few funds that have the potential to constantly generate alpha for its investors. And we have identified five such high alpha generating funds, in our latest report 'The Alpha Funds Report 2020'. Do not miss our latest research finding. Get your access to this exclusive report, right here!

Note:   This write up is for information purpose and does not constitute any kind of investment advice or a recommendation to Buy / Hold / Sell a fund. Returns mentioned herein are in no way a guarantee or promise of future returns. As an investor, you need to pick the right fund to meet your financial goals. If you are not sure about your risk appetite, do consult your investment consultant/advisor. Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.


Join Now: PersonalFN is now on Telegram. Join FREE Today to get ‘Daily Wealth Letter’ and Exclusive Updates on Mutual Funds



About the Company including business activity

Quantum Information Services Private Limited (QIS) was incorporated on December 19, 1989.

QIS was promoted by Mr Ajit Dayal with an objective of providing value-based information/views on news related to equity markets, the economy in general, sector analysis, budget review and various personal products and investments options available to the Public. It was the first company to start equity research on an institutional level.

'PersonalFN' is a service brand of QIS and was started in the year 1999. In 1999, the Company registered the Domain name for providing information on mutual funds and personal financial planning, financial markets in general, etc. and services related to financial planning and research in various financial instruments including mutual funds, insurance and fixed income products to customers. It offers asset allocation and researched investment recommendations through its financial planning services.

Quantum Information Services Private Limited (QIS) is registered as Investment Adviser under SEBI (Investment Adviser) Regulations, 2013 and having Registration No.: INA000000680. In terms of the second proviso to Regulation 3 (1) of SEBI (Research Analysts) Regulations, 2014 the Company is not required to obtain Certificate of registration from SEBI.

Disciplinary history

There are no outstanding litigations against the Company, its subsidiaries and its Directors.

Terms and condition on which its offer research report

For the terms and condition for research report click here.

Details of associates

  1. Money Simplified Services Private Limited;

  2. PersonalFN Insurance Services India Private Limited;

  3. Equitymaster Agora Research Private Limited;

  4. Common Sense Living Private Limited;

  5. Quantum Advisors Private Limited;

  6. Quantum Asset Management Company Private Limited;

  7. India Private Limited;

  8. HelpYourNGO Foundation;

  9. Natural Streets for Performing Arts Foundation;

  10. Primary Real Estate Advisors Private Limited;

  11. HYNGO India Private Limited;

  12. Suresh Lulla;

  13. I V Subramaniam.

Disclosure with regard to ownership and material conflicts of interest
  1. ‘subject company’ is a scheme on which a buy/sell/hold view or target price is given/changed in this Research Report;

  2. Neither QIS, it's Associates, Research Analyst or his/her relative have any financial interest in the subject Company;

  3. Neither QIS, it's Associates, Research Analyst or his/her relative have actual/beneficial ownership of one per cent or more securities of the subject Company, at the end of the month immediately preceding the date of publication of the research report;

  4. Neither QIS, it's Associates, Research Analyst or his/her relative has any other material conflict of interest at the time of publication of the research report except that QIS (PersonalFN) is, as per SEBI (Mutual Funds) Regulations 1996, an associate / group Company of Quantum Asset Management Company Private Limited and Trustees and Sponsor of Quantum Mutual Fund (QMF) and to that extent there may be conflict of interest while recommending any schemes of QMF. However, any such recommendation or reference made is based on the standard evaluation and selection process, which applies uniformly for all Mutual Fund Schemes. The payment of commission (upfront / annualized & trail), if any, for any Schemes by QMF to QIS (PersonalFN) is also at arm's length and as per prevailing market practices.

Disclosure with regard to receipt of Compensation
  1. Neither QIS nor it's Associates have received any compensation from the subject Company in the past twelve months;

  2. Neither QIS nor it's Associates have managed or co-managed public offering of securities for the subject Company;

  3. Neither QIS nor it's Associates have received any compensation for investment banking or merchant banking or brokerage services from the subject Company;

  4. Neither QIS nor it's Associates have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months.

  5. Neither QIS nor it's Associates have received any compensation or other benefits from the subject Company or third party in connection with the research report

General disclosure
  1. The Research Analyst has not served as an officer, director or employee of the subject Company.

  2. QIS or the Research Analyst has not been engaged in market making activity for the subject Company.

Click here to read PersonalFN's Mutual Fund Rating Methodology

Subject Company means Mutual Fund Schemes

Quantum Information Services Private Limited CIN: U65990MH1989PTC054667 Regd. Office: 103, Regent Chambers, 1st Floor, Nariman Point, Mumbai - 400 021 Corp. Office: 103, Regent Chambers, 1st Floor, Nariman Point, Mumbai - 400 021. Website: Tel.: 022 61361200 Fax.: 022 61361222 SEBI-registered Investment Adviser. Registration No. INA000000680, SEBI (Investment Advisers) Regulation, 2013

Add Comments