Franklin India Smaller Cos Fund — Deep Analysis, NAV, Returns, Risk

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Fund Overview

Franklin India Smaller Cos Fund — Quick Summary

Franklin India Smaller Cos Fund is one of India's oldest and most respected small cap mutual funds, launched in September 2009. Managed by R. Srinivasan, Head of Equities at SBI MF, it has built a stellar 15-year track record by investing in quality small cap businesses ranked 251st and beyond by market capitalisation as defined by SEBI.

Fund House

Franklin Templeton Mutual Fund

✓ Suitable For

✓Investors comfortable with research-driven, global-framework investing

✓SIP investors with 7+ year horizon who have done their due diligence

✓Those seeking a long-established fund with a proven multi-cycle track record

✓Investors comfortable with slightly higher expense ratio for active management

✗ Not Suitable For

✗Investors still uncomfortable with the Franklin brand after the 2020 debt crisis

✗Anyone who needs money within 3–5 years — small caps can be down for years

✗Cost-conscious investors — 0.92% expense ratio is above category average

✗Those making it their only fund — concentration in small caps is dangerous

Who Runs This Fund

Fund Manager

RS

R. Janakiraman

Vice President & Fund Manager, Franklin Templeton India

Managing Since

2013

Experience

25+ Years

Funds Managed

4 Funds

Total AUM

₹45,000 Cr+

Known for his bottom-up stock picking approach and patience with small cap positions. Has navigated the fund through multiple market cycles including the 2018 NBFC crisis and 2020 COVID crash.

Fund History

Key Moments in Fund's Life

January 2006

🚀 Fund Launch

Franklin India Smaller Companies Fund launched as one of the earliest dedicated small cap funds in India. Franklin Templeton's global research capability was a key selling point from day one.

2009 — 2014

📈 Post-Crisis Compounding

After navigating the 2008 crisis, the fund delivered outstanding returns in the recovery. Its research-intensive approach identified quality small businesses that most investors overlooked.

2017 — 2018

🏆 Category Outperformance

The fund ranked among the top performers in the small cap category for consecutive years, cementing its position as one of India's premier small cap funds.

April 2020

🚨 The Debt Fund Bombshell

Franklin Templeton India wound up 6 of its debt funds citing COVID-related liquidity issues. While equity funds like this one were completely separate and unaffected, the reputational damage to the Franklin brand in India was severe. Many investors redeemed equity funds purely out of fear.

2021 — 2022

🔄 Rebuilding Trust

The equity fund continued performing well. Gradual return of investor confidence as the debt fund wind-up process resolved and payments were made to debt fund investors.

2023 — Present

📊 Performance Consistency

Consistent performance has helped Franklin Templeton India rebuild its equity brand. The smaller companies fund continues to be one of the better performing funds in the category over long periods.

What They Don't Tell You

The Dark Chapters

Every fund has painful periods. Here's an honest look at when Franklin India Smaller Cos struggled — because understanding this is crucial before investing.

April 2020 · The Debt Crisis

The Day Franklin Templeton Shocked India

On April 23, 2020, Franklin Templeton India announced the winding up of 6 debt funds — an unprecedented event in Indian mutual fund history. While this had zero impact on the equity fund's NAV or operations, thousands of equity fund investors panicked and redeemed. Those who stayed invested were fine; those who sold out of fear locked in losses and missed the recovery.

Reputational damage: Severe but unwarranted for equity funds

2018 — 2020 · 24 Months

Small Cap Bear Market

Like all small cap funds, Franklin Smaller Cos fell heavily during the 2018–2020 bear phase. The fund's higher expense ratio of 0.92% acted as an additional drag during a period of negative returns.

Peak to trough: ~40% decline

March 2020 · 6 Weeks

COVID Crash + Brand Crisis Simultaneously

Franklin Smaller Cos had the misfortune of facing both a COVID market crash and the debt fund crisis in the same month. Investors faced a double shock — NAV falling AND brand confidence shaking. Maintaining conviction during this period required exceptional investor discipline.

Double shock: Market crash + brand crisis

Structural Risk · Expense Ratio

Highest Cost Among Top 10 Funds

At 0.92%, Franklin Smaller Cos has one of the highest expense ratios among top small cap funds. Over a 10-year period, this extra cost compounds into a meaningful performance drag versus lower-cost peers. In a 15% return scenario, the extra ~0.3% cost compounds to a significant absolute amount over time.

Cost risk: 0.92% ER — above average

⚠️ Educational Disclaimer: The dark chapters above are presented for educational awareness only. Past difficulties do not predict future performance. RightAdvise.com is NOT a SEBI/AMFI registered advisor. Please consult a qualified financial advisor before investing.

Performance

Returns vs Benchmark

1 Month

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Nifty SC: —

3 Month

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Nifty SC: —

6 Month

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Nifty SC: —

1 Year

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Nifty SC: —

3 Year CAGR

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Nifty SC: —

5 Year CAGR

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Nifty SC: —

10 Year CAGR

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Nifty SC: —

Since Inception

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Sep 2009

Price History

NAV History

Consistency Analysis

Rolling Returns ℹ️ What is this?

Rolling returns show how the fund performed across every possible investment period — not just one cherry-picked date. This reveals true consistency. Learn more →

1Y Rolling (Avg)

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% of times positive: —

3Y Rolling (Avg)

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% of times positive: —

5Y Rolling (Avg)

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% of times positive: —

1-Year Rolling Returns Each point = 1yr return from that date

Risk Analysis

Maximum Drawdown ℹ️ What is this?

Drawdown shows the biggest fall from peak NAV. This is what investors actually experience during market crashes. Learn more →

Max Drawdown Ever

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Recovery time: —

2020 Covid Crash

-40.2%

Recovery: 14 months

2018 IL&FS Crisis

-28.6%

Recovery: 24 months

Current from Peak

—

Peak NAV: —

Drawdown Chart % fall from rolling peak NAV

Valuation Signal

NAV vs 200-Day Moving Average

When NAV is above 200 DMA, the fund is in an uptrend. When below, it signals caution. Many investors use this as a simple entry/exit signal.

Current NAV

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200 DMA

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NAV vs DMA

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Loading signal...

NAV vs 200 DMA

Risk Metrics

Risk Ratios

Alpha (3Y)

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Excess return over benchmark. Higher is better.

Beta (3Y)

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Volatility vs market. >1 means more volatile.

Sharpe Ratio

—

Return per unit of risk. >1 is considered good.

Sortino Ratio

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Like Sharpe but only penalises downside risk.

Std Deviation

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How much returns fluctuate. Lower = more stable.

R-Squared

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How closely it tracks the benchmark index.

Benchmark Comparison

Fund vs Nifty Smallcap 250

₹1 Lakh invested — Growth comparison

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