Strong performance by Axis ESG Equity Fund

Axis ESG Equity Fund was launched in February 2020. The scheme is managed by Mr Jinesh Gopani and Mr Hitesh Das, and has Rs 1963 crores of assets under management (AUM) as on 31^st July 2021 (source: Axis MF July 2001 fund factsheet). The expense ratio of the scheme is 2.12%. The scheme benchmark is Nifty 100 ESG TRI. The investment objective of the scheme is to generate long term capital appreciation by investing in a diversified portfolio of companies demonstrating sustainable practices across Environmental, Social and Governance (ESG) parameters.

Scheme Performance

The chart below shows the growth of Rs 10,000 in Axis ESG Equity Fund since the scheme inception. The CAGR returns of the scheme since inception is around 35%.

Source: Advisorkhoj Research, as on 26.08.2021. Regular Plan has been considered. Disclaimer: Past performance may or may not be sustained in the future.

SIP Performance

The chart below shows the growth of Rs 10,000 monthly SIP in Axis ESG Equity Fund. With a cumulative investment of Rs 1.8 lakhs, you could have accumulated a corpus of Rs 2.33 lakhs as on 30^th July 2021. The annualized SIP return (XIRR) since inception was 46.76%.

Source: Advisorkhoj Research, as on 31.07.2021. Regular Plan has been considered. Disclaimer: Past performance may or may not be sustained in the future.

What is ESG?

ESG is an acronym for environmental, social and governance, which form the three pillars of this style of investments. Environmental factors relate to impact (favourable or unfavourable) companies have on climate change, how they use natural resources, waste management etc. Social factors relates to how companies use human resources, health and safety of employees, how safe the products are for consumers, relationship with suppliers, customers and the broader community etc. Governance relates to how the management protects interest of all shareholders, prevents corrupt practices, ensures compliance with regulations and Government policies, accountability of the board of directors etc. The advantages enjoyed by stocks which score high on environmental, social and governance parameters may lead to lower investment risk, superior financial performance and better valuations.

Investment strategy and process - Axis ESG Equity Fund

• Sector level screening: Exclude sectors that are perceived to be harmful for the society e.g. tobacco, liquor, gambling etc.


• Stock level screening: Exclude stocks which throw up red flags as part of Axis MF’s internal ESG review.


• Portfolio construction: Portfolio allocation is based on detailed qualitative ESG review of each company complementing the fund house’s fundamental based investment process.


• International stocks: A portion of the portfolio is allocated to international stocks which score high on the ESG factors.


• Minimum 80% of the portfolio will be in stocks that rate highly in Axis MF’s internal ESG review. Selective allocations can be made to stocks with high growth potential and improving ESG trend.

Current portfolio – Axis ESG Equity Fund

• The current scheme portfolio has a large cap bias (92.1% of the portfolio), as on 31^st July 2021. The midcap allocation of the portfolio is 4.5% (as on 31^st July 2021). Source: Axis MF Product Leaflet (July 2021).


• Domestic equities constitute 70.95% while international equities comprise 26.69% of the scheme portfolio. 2.36% of the portfolio is in debt, cash and other current assets (as on 31^st July 2021). Source: Axis MF July fund factsheet.


• Financial services (32.26% of portfolio), retailing (18.79%), software (18.04%), consumer non durables (10.26%), and power (3.92%) comprise the Top 5 sectors of the scheme portfolio assets (as on 31^st July 2021). Source: Axis MF July fund factsheet.

Why invest in Axis ESG Equity Fund?

• Investors can aim for long term capital appreciation by investing in quality companies with sustainable growth prospect.


• Sustainable companies are expected to have lower risk and deliver sustainable growth.


• ESG factors are vital in ensuring the future of our planet and society. Companies which take into consideration the ESG factors in their business strategy and processes are making important contribution for our future generations. As investors, you can support such companies, by investing in ESG funds.


• Axis Mutual Fund is well positioned to incorporate ESG theme while investing basis their core focus towards quality and sustainable growth.

Who should invest in Axis ESG Equity Fund?

• Investors who want to support companies who are committed to ESG principles


• Investors who want capital appreciation over long investment horizons


• Investors with high risk appetites


• Investors who have at least 5 years investment tenures

Investors should consult with their financial advisors if Axis ESG Equity Fund is suitable for your investment needs.