5 Best ELSS Funds To Invest In 2023 For Tax Savings

ICICI Direct published a Mutual Fund Review Report on December 23, 2022, highlighting the equity market trends and outlook. In the report, the brokerage has also listed 5 Equity Linked Saving Scheme or ELSS funds. These 5 ELSS funds are open-ended highly risky funds.

ELSS is a form of Mutual Fund that allows tax savings under Section 80C of the Income Tax Act of 1961. In addition to receiving a tax benefit, these funds also have the chance to profit from the Indian equity market's long-term upside potential. These have the potential to offer the highest returns among 80C options and are also the shortest of all tax-saving investments. However, these funds have a 3-year lock-in period, which aids fund management in adopting a long-term perspective and stabilises performance. These funds seek long Term Capital Appreciation by investing predominantly in Equity & Equity related instruments.

1. Canara Robeco Equity Taxsaver Fund

Canara Robeco Equity Tax Saver Fund is an ELSS mutual fund scheme launched on January 2, 2013, by Canara Robeco Mutual Fund. The fund has been rated 5 star by Value Research & 4 star by CRISIL, respectively. As of November 30, 2022, the fund has Rs 4,583 crore of assets under management (AUM) and its expense ratio is 0.61%. Its benchmark is S&P BSE 500 TRI. You can start investing in the find with Rs 500 via SIP and Rs 500 for a lump sum investment.

It has major investments in the Financial sector, followed by the Technology sector, Automobile sector and healthcare sector. It has major holdings in ICICI Bank, HDFC Bank, Infosys, Reliance, and State Bank of India (SBI).

2. Franklin India Taxshiled Fund

Franklin India Taxshiled Fund is another ELSS fund scheme that you can invest in 2023 recommended by the ICICI Direct. It was launched on April 10, 1999, by Franklin India Mutual Fund. The fund has been rated 3 star by Value Research and CRISIL, respectively. As on November 30, 2022, the fund has Rs 5,096 crore of AUM and its expense ratio is 1.90%. NIFTY 500 TRI is the fund's benchmark. To begin investing in this fund, the minimum investment amount is Rs 500 and for investments via SIP, it is Rs 500.

The fund has the majority of holdings in the Financial sector, Technology sector, Consumer Staples Sector, and energy sector. Its top 5 holdings include ICICI Bank, HDFC Bank, Axis Bank, Infosys and Bharti Airtel.

3. IDFC Tax Advantage Fund

IDFC Tax Advantage Fund is 3rd ELSS fund on the list recommended by the brokerage. It is also a top-rated fund by leading agencies, rated 5 star by CRISIL and 4 star by Value Research. It was launched on 26 December 2008 by the IDFC Mutual fund. The benchmark of the fund is S&P BSE 500 TRI. The recorded AUM of the fund as on 30 November 2022 is Rs 4,091 crore and the expense ratio is 0.75%. To start investments in the fund, Rs 500 is Required and for SIP, it is Rs 1,000.

Sector-wise the top 5 holdings of the fund include the Financial sector, Automobile sector, Technology sector, material sector, and Healthcare sector. The top 5 holdings of the fund are ICICI Bank, Infosys, State Bank of India (SBI), HDFC Bank, and Reliance.

4. Mirae Asset Tax Saver Fund

Mirae Asset Tax Saver Fund is another top-rated tax-saver mutual fund recommended by ICICI Direct you can think about. It has been rated 3 star by the CRISL and 5 star by Value Research. It is a 7-year-old fund launched on 28 December 20165 by the Mirae Asset Mutual Fund. Its Benchmark is NIFTY 500 TRI.

The AUM is Rs 14,255 crore and the expense ratio is Rs 0.55% as on 30 November 2022. You can star investments in this fun with Rs 500 for a lump sum investment and with Rs 500 to begin SIP in this fund. The fund invests in equity and equity-related instruments to generate capital.

The top 5 sectors in which the fund has investments include Financial, Energy, Technology, Automobile and Healthcare. The top holdings of the fund are in HDFC Bank, ICICI Bank, Reliance, Infosys, and Axis Bank.

5. Tata Tax Savings Fund

Tata India Tax Savings Fund is the last ELSS fund recommended by the brokerage. This fund is an 8-year-old fund launched on October 13, 2014, by the Tata Mutual Fund. This is also a top-rated equity fund that has been rated 3 star by CRISIL and 3 star by Value Research, respectively. Its benchmark is NIFTY 500 TRI. As of 30 November 2022, it has an AUM of Rs 3,280 Crores and an expense ratio of 0.75%. One can start investing in this with Rs 500 and to begin investing in SIP, requires a minimum of Rs 500.

Financial, Technology, Energy, Capital Goods and Healthcare are the top sectors in which the fund has holdings, whereas, ICICI Bank, HDFC Bank, Infosys, Reliance, and Housing Development Finance are the fund's top 5 holding stocks.

ELSS Fund- Annualised SIP Returns

ELSS Fund	1-year	2-Year	3-year
Canara Robeco Equity Taxsaver Fund	7.92%	10.34%	20.21%
Franklin India Taxshiled Fund	13.37%	13.98%	22.77%
IDFC Tax Advantage Fund	10.61%	15.14%	27.05%
Mirae Asset Tax Saver Fund	7.18%	7.18%	20.45%
Tata Tax Savings Fund	13.26%	13.92%	21.11%

Note - Returns Under Direct Plan-Growth Option of the funds

Disclaimer

Mutual fund investments are subject to market risk. Read all scheme-related Terms and Conditions carefully before investing. The above-mentioned information is purely informational and doesn't guarantee any return. The Greynium Information Technologies and the Author are not liable for any losses caused as a result of a decision based on the article.