Sundaram Mid Cap Fund – Direct-Growth: Key Insights, Returns, Risks, and More

Midcap funds have always been a favorite of investors who are willing to take calculated risks to earn better returns. Midcap funds offer the best of both worlds that is higher stability similar to large-cap and higher returns similar to small caps. Thus, investing in these funds can be fruitful in the long term for generating wealth. To help you with your investment journey, we have come up with this article which will revolve around the details of the Sundaram Mid Cap Fund. You will read all the insights about this fund, starting from its returns to the risk involved, different financial metrics you can evaluate from here, and more. 

Fund Management and Objectives

Sundaram Mid Cap Fund Direct-Growth was launched on the 1^st of January, 2013. This scheme’s investment objective is to appreciate capital and build a corpus over the long term. The fund considers the stocks ranking from the 51^st number out of the stocks listed on the NSE and ranked as per the market capitalization. 

Sundaram Mid Cap Fund Direct-Growth is managed by – 

• Bharath S.: He has been managing the fund since 2021’s February. Before joining Sundaram Mutual Fund, he was associated with Navia Markets Ltd and holds an MBA as well as he is a Charter holder from ICWA. Apart from this fund, he manages many other funds of the fund house such as the Sundaram Aggressive Hybrid Fund, Sundaram Business Cycle Fund, and others. 
• Ratish Varier:  He has also been managing this fund since February 2021 and he served Mahindra Asset Management and Reliance Life Insurance prior to joining Sundaram Mutual Fund. He is an MBA as well. He has also been managing other funds such as the Sundaram Infrastructure Advantage Fund, Consumption Fund, Dividend Yield Fund, and others. 

Excited about investing in the Sundaram Mid Cap Fund? Open a free Demat account today!

How Does the Sundaram Mid Cap Fund Work?

The Sundaram Mid Cap Fund invests primarily in mid-cap companies to earn returns for the long term. The fund manager/s picks the most promising stocks and adds them to the fund portfolio to generate long-term returns. It invests in the equity and equity-related instruments of the mid-cap companies. 

The fund manager aims to balance the return with the risk associated with the mid-cap stocks. By diversifying the fund, across sectors, they try to reduce the risk quotient while increasing the chances of generating positive returns. 

Performance and Returns (As of 17 Feb 2025) 

Sundaram Mid Cap Fund Direct-Growth has been performing consistently since its inception. It has an annualized return of 18.05% since its inception. However, in the recent past, due to a rise in market volatility, the fund has been performing sluggishly. However, the long-term returns look promising. Here is a snapshot of the returns – 

Time Frame	Sundaram Mid Cap Fund Direct-Growth (%)	Category Average (%)
Since Inception	18.05	NA
6 Month	-11.50	-11.50
3 Month	-9.47	-9.57
1 Month	-8.52	-9.10
1 Day	0.19	0.23
YTD	-14.28	-13.81
1 Year	7.61	5.05
3 Year	20.94	18.66
5 Year	20.30	22.48
7 Year	13.74	16.16
10 Year	14.33	15.61

Investment Allocation (As of 31 Jan 2025)

The Sundaram Mid Cap Fund-Growth has 94.63% of its assets invested in equity and equity-related instruments while 4.92% invested in cash and cash equivalent and 0.45% in Debt instruments. 

Market cap-wise asset allocation 

• Giant cap – 3.92%
• Large Cap – 37.71%
• Mid-cap – 58.37%

As of 31 January 2025, the fund had an average market cap of ₹56002 crore and it spans across 79 stocks where the top 10 stocks make up 25.28% of its assets. 

Sectoral Allocation 

The fund invests across sectors offering a well-diversified portfolio, here are the top five sectors as of 31 January 2024 – 

Sectors	Allocation (%)
Financial	20.37
Consumer discretionary	18.43
Industrials	13.95
Materials	11.39
Healthcare	8.83

Stock-wise Allocation 

The top five stocks of the Sundaram Mid-cap Fund include – 

Stock	Assets (%)
Cummins India	3.16
The Federal Bank	3.10
Coromandel International	2.72
Kalyan Jewellers	2.60
Persistent Systems	2.51

Key Metrics 

As of 31 January 2024, the fund has an expense ratio of 0.93%, which is lower than the category average of 0.80%.

Fund Details	Information
AUM (Assets Under Management)	₹11638 Crore as of 31 January 2025
Category	Equity Fund, open-ended
Fund Manager	Bharath S., Ratish Varier
Exit Load	1% on units above 25% of investments redeemed within 365 days of investment
Entry Load	Nil
Minimum Investment	₹100(Lump sum)₹100 (SIP)
Benchmark	Nifty Midcap 150 (TRI)

The Sundaram Mid Cap Fund NAV as of 17 February 2025 stood at ₹1285.4963. 

Risk and Performance of the Sundaram Mid Cap Fund 

This fund is classified as a ‘Very High Risk’ fund, which indicates that the fund has the potential for higher returns but there will be high volatility as well. 

1. Standard Deviation (Std Dev %): It shows how much the returns vary from the average returns generated by the funds themselves. The higher this number, the more it fluctuates.

The Standard deviation of the fund is around 15.21% nominally lower than the category average of 15.63% indicating little lesser fluctuations. 

2. Beta: This ratio indicates the volatility of the fund’s performance, compared to similar funds in the market. The lower the Beta, the more predictable the returns are, and vice versa. It helps in comparing funds. 

The Sundaram Midcap fund has a beta of 0.91% while the category average is 0.92% again indicating slightly less volatility. 

3. Sharpe Ratio: This ratio indicates the return you get for the risk you’re taking. A higher number means better risk-adjusted returns.

Currently, this fund has a Sharpe ratio of 1.05%, while that of the category is 0.87%, which indicates that the fund has been offering a better risk-adjusted return. 

4. Sortino Ratio: It is similar to Sharpe but only looks at downside risk (the risk of losing money).

While the average for the category stands at 1.40%, this fund has 1.65% indicating better downside risk-adjusted profits. 

5. Alpha: It measures the extra return the fund gives above the market’s average return.

The fund offers a way better return compared to that of its peers as depicted by its Alpha of 2.93% while the average of the category is 0.41%. 

Taxation for Sundaram Mid Cap Fund 

If you’re investing in the Sundaram Mid Cap Fund, here’s how your returns will be taxed:

1. Short-Term Gains – If you sell the fund units within 1 year of the date of investment, a 20% tax will be levied on the entire return generated during the period. 
2. Long-Term Gains – If you sell the fund units after one year, any profit generated over and above ₹ 1.25 lakh will be taxable at a 12.5% rate. The same rate will be applicable for any investment tenure above 1 year. 

So, the longer you hold your investments, the better returns you can expect and the lesser effect of taxes!

3. Taxes on Dividends – Dividends earned if any will be taxable at the hands of investors as per their tax slabs. If the dividend income surpasses Rs. 5000 in a financial year, then the fund house will deduct 10% TDS before disbursing the dividend into the account of the investor. 

Minimum Investment and Lock-in Period

The minimum investment amount in the Sundaram Mid Cap Fund is ₹100 for a lump sum and SIP is ₹100. There is no lock-in period for the Sundaram Mid Cap Fund Direct-Growth.

How to Invest in Sundaram Mid Cap Fund Direct?

You can invest in the Sundaram Mid Cap Fund – Direct Growth plan with Shoonya. 

Shoonya offers a free Demat account,  Zero brokerage trading, advanced trading tools, 100+ technical indicators, and much more!

Investing in Lump Sum Mutual Funds through the Shoonya Web Platform

Here’s a quick guide on how to invest in lump sum mutual funds through the Shoonya web platform:

1. First, you must log in to your Shoonya account at trade.shoonya.com. From the “Orders” section, click on “MF order.”
2. Search for the fund you wish to invest in; in this case, the Sundaram Mid Cap Fund – Direct Growth plan.
3. Choose “Fresh” for a new investment and enter the amount you want to invest.
4. You can complete your purchase by clicking the “Purchase” button.
5. You will receive a payment link on your registered email. Use the link to make the payment.

After payment, your mutual fund units will be allotted to your Demat account within T+2 days.

Note: You can only make the payment using the bank account registered with your Demat account.

Setting Up an SIP for Mutual Funds

If you prefer a Systematic Investment Plan (SIP) for Sundaram Mid Cap Fund Direct Plan-Growth plan, you must follow these steps:

1. First, you need to log in to your Shoonya account at trade.shoonya.com. Go to “Orders” and click on “XSIP.”
2. Find the mutual fund for which you want to set up an SIP. In this case, the Sundaram Mid Cap Fund – Direct-Growth plan.
3. If this is your first SIP with Shoonya, you need to create a Mandate ID. 

For that, you must enter the mandate amount and the validity date (until you want to keep your SIP active).

4. You must submit the details, and you’ll receive a Mandate authentication link via email. Approval generally takes 24 hours.

Once your Mandate is approved, you can follow these steps to set up your SIP:

1. Go to “XSIP,” enter the SIP amount, and select “Fresh” as the transaction type.
2. Choose the date when the SIP will be debited directly from your registered bank.
3. The approved Mandate ID will auto-reflect.
4. Choose “Monthly” for monthly debits and specify the number of installments (e.g., 24 installments for a 2-year SIP).

If you do not want to forget your SIPs and invest systematically, the SIP method can be most suitable for you. 

Why Invest in the Sundaram Mid Cap Fund?

The reasons for investing in the Sundaram Midcap Fund Direct-Growth can be the fund’s – 

• Diversified portfolio which spreads the investment across sectors
• Offer better risk-adjusted returns 
• The fund has been consistently performing well since its inception
• Helps in capital accumulation 

Suitability of this Fund| Who Should Invest?

The Sundaram Mid Cap Fund Direct is suitable for investors who:

• Are looking for higher returns and ready to take higher risk 
• Looking for long-term capital appreciation 
• Can stay invested for at least seven years 
• Can tolerate several ups and downs during the investment tenure

Conclusion

So, if you are interested in mid-cap funds for long-term capital appreciation then Sundaram mid-cap fund can be considered for the portfolio. It not only has a consistent track record but also offers better risk-adjusted returns which is crucial for midcap funds. 

Sundaram Mid Cap Fund Direct Plan-Growth |FAQs

Source: ValueResearch

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Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.