Kotak Small Cap Fund
Direct · GrowthAI Summary
Kotak Small Cap Fund has delivered strong long-term SIP returns, with 10Y XIRR of 21.38% and 12Y XIRR of 20.05%, modestly ahead of the category averages of 20.91% and 19.35% respectively. However, over shorter horizons it lags peers, with 3Y XIRR of 21.32% versus the category's 22.67% and 5Y XIRR of 20.67% versus 22.02%. Against the NIFTY SmallCap 250 benchmark, the fund trails on a lump-sum basis over 1Y, 3Y, and 5Y (e.g., 14.69% vs 16.03% over 5Y), but outperforms meaningfully over longer periods, with 12Y CAGR of 18.94% versus 14.04% for the benchmark.
The fund exhibits a defensive risk profile for a small cap strategy, with beta of roughly 0.73-0.86 across periods and consistently lower downside capture (69.88%-83.99%) than upside capture, indicating it falls less than the benchmark in weak markets. Six drawdown events exceeding 10% reflect the inherent volatility of the small cap segment, and the maximum drawdown took 806 days with a 226-day recovery, underscoring the need for patience. Calmar ratios of around 0.50-0.61 across horizons suggest reasonable risk-adjusted returns given the drawdown experience.
Portfolio composition data such as top holdings and sector allocation was not provided in this dataset, so specific concentration and diversification details cannot be assessed. As a small cap fund, it must hold at least 65% in small cap equities per SEBI norms, which inherently carries higher company-specific and liquidity risk. Investors should review the latest factsheet for current holdings and sector exposure before investing.
The fund sits in the middle of its category: it beats the category average SIP XIRR over 10Y (21.38% vs 20.91%) and 12Y (20.05% vs 19.35%), but trails over 3Y and 5Y. Its calendar year record shows strong consistency in up years, including 71.58% in 2021 and 74.87% in 2014, though it has had four negative years in the last fourteen. The long-term alpha of 5.40%-6.80% over 7Y-15Y demonstrates genuine benchmark outperformance over full market cycles.
This fund suits investors with a high risk tolerance and a horizon of at least 7 years, as the long-term alpha emerges only over extended periods while shorter windows show benchmark underperformance. It is appropriate as a satellite allocation within a diversified equity portfolio, ideally accessed through SIPs to smooth the volatility evident in its calendar year returns. Investors who cannot tolerate multi-year drawdowns and negative years, such as 2025's -9.12%, should limit exposure to this category.
- Strong long-term benchmark outperformance with alpha of 6.80% over 12Y and 5.40% over 10Y versus the NIFTY SmallCap 250
- Consistently lower downside capture than upside capture (e.g., 69.91% downside vs 76.92% upside over 12Y), indicating defensive behavior in falling markets
- Competitive expense ratio of 0.55% for the direct plan, supporting net returns for long-term investors
- Underperformance versus both category average SIP XIRR and benchmark CAGR over 1Y, 3Y, and 5Y horizons, with negative alpha of roughly -0.45% over 1Y and 3Y
- Extended drawdown experience, with the maximum drawdown lasting 806 days and six drawdown events exceeding 10%, requiring high investor patience
Generated on 06-09-2026, 8:00 PM. Verify before investing.
Gives more importance to longer time periods (10Y, 20Y) than shorter ones (1Y, 3Y). This balances out recent outperformance and gives a more realistic picture of what long-term returns might look like.
The largest peak-to-trough decline in the fund's NAV. Shows the worst-case loss an investor would have experienced at any point in the fund's history.
If you invested ₹1,00,000 every month via SIP, here's how this fund has historically performed across different time horizons.
| Duration | Invested | Median Value | XIRR | Min XIRR | Max XIRR |
|---|---|---|---|---|---|
| 1 Year | ₹12.00 L | ₹12.96 L | 26.5% | -52.5% | 158.2% |
| 3 Years | ₹36.00 L | ₹49.13 L | 21.3% | -22.6% | 61.1% |
| 5 Years | ₹60.00 L | ₹1.05 Cr | 20.7% | -8.9% | 37.1% |
| 7 Years | ₹84.00 L | ₹1.87 Cr | 21.6% | 1.3% | 31.1% |
| 10 Years | ₹1.20 Cr | ₹3.66 Cr | 21.4% | 16.0% | 25.5% |
| 12 Years | ₹1.44 Cr | ₹5.27 Cr | 20.0% | 16.3% | 24.4% |
SIP returns vs benchmark & category
Annualised SIP return (XIRR) over each rolling horizon — like-for-like, not lump-sum.
| Duration | Fund SIP XIRR | NIFTY SMALLCAP 250 | Category avg | Fund edge |
|---|---|---|---|---|
| 1 Year | 26.5% | 22.0% | 21.6% | +4.5% |
| 3 Years | 21.3% | 15.3% | 22.7% | +6.1% |
| 5 Years | 20.7% | 14.3% | 22.0% | +6.4% |
| 7 Years | 21.6% | 14.4% | 21.8% | +7.2% |
| 10 Years | 21.4% | 14.0% | 20.9% | +7.4% |
| 12 Years | 20.0% | 13.5% | 19.4% | +6.6% |
| Duration | Mean | Median | Min | Max | Sharpe | Sortino | % Positive | Cat. Mean | Cat. Median |
|---|---|---|---|---|---|---|---|---|---|
| 1 Year | 24.9% | 17.1% | -28.6% | 144.3% | 0.56 | 2.42 | 78% | — | — |
| 3 Years | 21.7% | 20.7% | -8.9% | 48.9% | 1.27 | 6.45 | 96% | — | — |
| 5 Years | 21.0% | 21.1% | 1.0% | 38.7% | 1.86 | 25.60 | 100% | — | — |
| 10 Years | 20.9% | 20.6% | 16.7% | 26.4% | 5.71 | — | 100% | — | — |
Calmar Ratio by Duration
Compared against NIFTY SMALLCAP 250
| Duration | Alpha | Beta | Upside Capture | Downside Capture | Fund CAGR | Bench CAGR |
|---|---|---|---|---|---|---|
| 1 Year | -0.45 | 0.86 | 84.9% | 84.0% | 7.9% | 8.7% |
| 3 Years | -0.46 | 0.76 | 76.3% | 75.3% | 14.3% | 17.4% |
| 5 Years | +1.21 | 0.73 | 74.5% | 71.9% | 14.7% | 16.0% |
| 7 Years | +6.17 | 0.77 | 78.0% | 71.7% | 24.7% | 22.1% |
| 10 Years | +5.40 | 0.75 | 75.8% | 69.9% | 17.8% | 14.3% |
| 12 Years | +6.80 | 0.75 | 76.9% | 69.9% | 18.9% | 14.0% |
| 15 Years | +5.43 | 0.75 | 77.7% | 71.3% | 17.2% | 13.5% |