Tata Digital India Fund: Your Gateway to Digital Growth

Do you want to capitalize on the booming digital economy of India with mutual fund investing? Then you should go for investing in the Tata Digital India Fund, launched by Tata Mutual Funds. This fund offers exposure to the country’s thriving IT and digital sectors.

It is a sectoral technology fund that primarily invests in equities of leading IT companies in India and aims for long-term capital appreciation for investors.

In this article, you will explore the portfolio of this mutual fund together with the benefits offered and the risks associated with this fund. You will also know the fund managers and their investment style, which will help you in your wealth creation.

Tata Digital India Fund Review 

A sectoral-technology mutual fund scheme by Tata Mutual Funds, the Tata Digital India Fund, was launched on December 28, 2015. It invests almost 80% of its assets in equity and related instruments of companies under the Indian IT (Information Technology) sector, aiming for long-term capital appreciation.

Benchmarked against the Nifty IT Total Return Index, this fund has assets under management (AUM) worth Rs 11,501.01 Crores (as of July 31, 2025). The direct plan of this fund has an expense ratio of 0.43% (lower than the category average of 0.60%) and the Tata Digital India Fund Regular Plan growth has an expense ratio of 1.68% as of August 13, 2025.

This mutual fund has a minimum investment requirement of Rs 5000 for a lump sum and Rs 100 for SIP. If the fund is redeemed within 30 days, then it contains the exit load of 0.25%. The fund has a very high risk level. The Tata Digital India Fund NAV is Rs 53.59 as of August 19, 2025. This mutual fund has a fund size of Rs 11501.01 crore.

 Analysing Performance and Portfolio of Tata Digital India Fund

Let us analyse the performance and portfolio composition of this mutual fund and see how consistent this fund has been and in which sectors it invests:

Performance of Tata Digital India Fund

• Returns

• -5.34% returns in 1 Year against -7.5% category average, 13.64% returns in 3 Years against 11.15% category average, 23.33% returns in 5 Years against 20.52% category average and 18.99% returns by the fund since inception.
• Rolling Returns (3-Year Average)
• The fund has consistently outperformed its benchmark on a 3-year rolling returns basis.
• Benchmark and Category Average
• The fund has consistently generated higher annualized returns than the category average for the past 1, 3, and 5 years. It has also demonstrated a higher alpha (6.24) compared to its benchmark (Nifty IT Total Return Index).

Portfolio Composition of Tata Digital India Fund

Equity Allocation: Around 96.84% in equities.

• Top Sectors: The fund primarily invests in the Technology, Services, and Communication sectors.
• Top Holdings (as of July 2025):

• Infosys Ltd. (19.22%)
• Tata Consultancy Services Ltd. (11.88%)
• Tech Mahindra Ltd. (9.09%)
• Wipro Ltd. (7.08%)
• Eternal Ltd. (6.95%)

 Benefits of Investing in Tata Digital India Fund

Several benefits offered by the Tata Digital India Fund are as follows:

• Focused Exposure to the Indian Digital Economy
• The fund invests in top IT, technology and digital companies, allowing investors to benefit from India’s expanding digital economy.
• High Growth Potential
• The fund has outperformed many diversified equity funds and delivered strong high growth potential over the past 5 years.
• Diversification
• This mutual fund diversifies its portfolio across various IT sectors, and adding a technology-focused fund provides a balance to your portfolio.
• Management and Expertise
• Managed by seasoned professionals with a deep knowledge of digital sectors, this fund has the potential for informed stock selection and risk management.
• Alignment with Global Trends
• The fund can benefit from global trends like automation, machine learning, data analytics and the expansion of digital infrastructure.
• Potential for Outperformance
• The fund has shown a track record of consistently outperforming its benchmark and also has a lower expense ratio, making it reliable for investors.
• Accessibility
• Low minimum requirement for SIP (as little as ₹100) makes this mutual fund accessible to a broad range of investors, including both new and seasoned investors.

 Who Manages the Tata Digital India Fund

The Tata Digital India Fund is managed by Meeta Shetty, supported by Hasmukh Vishariya. The details about them    are given below:

Meeta Shetty

• Tenure: since March 9, 2021

• Experience: Over 17 years in the financial industry, specializing in the technology, pharma, and telecom sectors.
• Role: Fund Manager for Tata Digital India Fund and Tata India Pharma and Healthcare Fund since November 2018.
• Previous Roles: Positions at Kotak Securities, HDFC Securities, Asian Market Securities and Dalal & Broacha Stock Broking.
• Investment Philosophy: She focuses on GARP (Growth at Reasonable Price), highlighting scalability, management quality and profitability to identify strong growth companies.

Hasmukh Vishariya

• Experience: He joined Tata Asset Management as an Equity Research Analyst in March 2024 and has approximately 8 years of experience.
• Role: Supports fund management alongside Meeta Shetty, bringing additional insight on portfolio construction and risk mitigation.
• Previous Roles: Positions at Star Union Dai-ichi Life Insurance as an Equity Research Analyst.

Meeta Shetty is the primary fund manager known for her sector expertise in technology and pharma, supported by Hasmukh Vishariya’s complementary management style.

Together, they blend deep research experience and focused stock selection to navigate the digital technology sector effectively within the fund.

 Risks Associated With the Tata Digital India Fund

There are various risks associated with the Tata Digital India Fund that are crucial to understand before investing in this mutual fund, which are:

• Sectoral Concentration Risk
• The fund mainly focuses on equity investments (80% of net assets), which can make the fund vulnerable to market downturns.
• High Volatility
• According to the SEBI’s riskometer, the fund has a very high risk level, which results in higher volatility than a diversified equity fund.
• Benchmark Tracking and Performance
• The fund may not consistently outperform the benchmark, especially during periods when the technology sector underperforms in the market.
• Market and Economic Risk
• This fund is exposed to overall market risks and fluctuations, so a downturn in market or economic factors can impact the fund’s growth.
• Liquidity Risk
• Although the fund is open-ended, it is crucial to consider liquidity in case of large redemptions during periods of market stress.

 Conclusion

In short, Tata Digital India Fund, launched by Tata Mutual Funds, is a sectoral technology fund that invests in equities of leading IT companies and helps you in your long-term wealth creation through the booming Indian digital industry.

This mutual fund also provides you with SIP investment options. You can start SIP with this fund and invest a small amount in regular intervals to maintain the stability of your investment.