Franklin India Prima Fund Direct Growth

Franklin India Prima Fund Direct Growth is a prominent player in the mid-cap category with an impressive Assets Under Management (AUM) of ₹10,594.08 Crores, ranking 9th in its category. The fund's expense ratio stands at 0.98%, placing it as the 5th most expensive in its category. This suggests that while the fund may have higher costs, investors might expect superior management and potential returns to justify these expenses.

The fund exhibits a well-diversified sector allocation, with significant investments in financials (21.19%), cyclical sectors (19.04%), and basic materials (15.17%). This diversification helps mitigate risks associated with sector-specific downturns. In terms of market cap allocation, the fund predominantly focuses on mid-cap stocks, which make up 65.95% of its portfolio. This focus aligns with its mid-cap categorization, offering potential for higher growth compared to large-cap funds, albeit with increased volatility.

Franklin India Prima Fund Direct Growth has demonstrated strong performance metrics, particularly in its 1-year alpha of 7.51, indicating a significant excess return over its benchmark. The fund's up market capture ratio of 121.9% over the past year highlights its ability to outperform during market upswings. However, its 5-year alpha of -1.61 suggests challenges in consistently outperforming the benchmark over longer periods. The fund's beta of 0.99 over the past year indicates volatility similar to the market, while its Sharpe ratio of 0.133 suggests moderate risk-adjusted returns.

When compared to the mid-cap category, Franklin India Prima Fund Direct Growth stands out with a higher 1-year alpha of 7.51 versus the category's 2.63. Its up market capture ratio of 121.9% also surpasses the category's 107.65%, showcasing its superior performance in rising markets. However, the fund's 5-year performance metrics, such as a negative alpha and lower Sharpe ratio compared to the category, indicate areas for improvement in long-term risk-adjusted returns.

The fund's heavy allocation towards equities (96.93%) underscores its strategy focused on capital appreciation, making it suitable for investors with a higher risk tolerance and a long-term investment horizon. The inclusion of small-cap (16.77%) and large-cap (12.83%) stocks provides a balanced approach to capturing growth across different market segments. Potential investors should consider the fund's higher expense ratio and ensure it aligns with their investment goals and risk appetite.