10 Best Mutual Funds in India
Investing in mutual funds has become a cornerstone for financial growth in India, thanks to their versatility and potential for long-term wealth creation. With a plethora of options available, choosing the 10 best mutual funds in India can feel like navigating a labyrinth. But fret not! In this guide, we’ll break it down for you, helping you pick funds that align with your financial goals, risk appetite, and investment horizon.
The Growth Story of Mutual Funds in India
Over the past decade, mutual funds have emerged as a preferred choice for both novice and seasoned investors. With benefits like professional management, diversification, and the potential for higher returns, mutual funds cater to a wide range of financial aspirations. As of 2024, the Indian mutual fund industry’s Assets Under Management (AUM) have crossed a staggering ₵3 lakh crore—a testament to their popularity.
But why are mutual funds such a hit? The answer lies in their ability to offer tailored solutions for every investor. Whether you’re planning for retirement, your child’s education, or building wealth for the long term, there’s a mutual fund for you.
What Makes These 10 Mutual Funds Stand Out?
The funds listed here are handpicked based on consistent performance, asset quality, expense ratios, and investor trust. Our selection spans equity, debt, and sectoral funds, ensuring there’s something for everyone. These funds not only deliver competitive returns but also adhere to high standards of transparency and governance.
Best Mutual Funds in India
| Fund Name | Category | AUM (₹ Cr) | Min. Invest (₹) | 1-Year Return (%) | Expense Ratio (%) | Age (Years) |
|---|---|---|---|---|---|---|
| Quant Small Cap Fund | Small Cap | 27,161 | 1,000 | 44.10 | 0.64 | 11+ |
| Motilal Oswal Midcap Fund | Mid Cap | 22,898 | 500 | 44.09 | 0.57 | 10+ |
| Bandhan Infrastructure Fund | Sectoral-Infrastructure | 1,798 | 500 | 39.89 | 0.81 | 11+ |
| Nippon India Small Cap Fund | Small Cap | 61,646 | 500 | 39.74 | 0.68 | 11+ |
| ICICI Prudential Infrastructure Fund | Sectoral-Infrastructure | 6,990 | 500 | 39.70 | 1.23 | 11+ |
| DSP India T.I.G.E.R. Fund | Sectoral-Infrastructure | 5,515 | 500 | 39.07 | 0.84 | 11+ |
| Nippon India Power & Infra Fund | Sectoral-Infrastructure | 7,557 | 500 | 38.50 | 0.95 | 11+ |
| Invesco India Infrastructure Fund | Sectoral-Infrastructure | 1,609 | 500 | 37.88 | 0.71 | 11+ |
| Franklin Build India Fund | Sectoral-Infrastructure | 2,848 | 500 | 37.47 | 0.92 | 11+ |
| Canara Robeco Infrastructure Fund | Sectoral-Infrastructure | 867 | 1,000 | 37.47 | 1.00 | 11+ |
| SBI PSU Fund | Thematic-PSU | 4,686 | 500 | 37.42 | 0.76 | 11+ |
10 Best Mutual Funds in India
1. Quant Small Cap Fund: Unveiling the Genius
Why Choose Quant Small Cap Fund? The Quant Small Cap Fund has consistently outperformed its peers, making it a favorite among growth-focused investors. With an impressive annualized return of 44.10%, it’s one of the top-performing small-cap funds in India.
Key Features
- High Growth Potential: Targets emerging companies with exponential growth trajectories.
- Low Expense Ratio: At just 0.64%, it ensures most of your investment works for you.
- Flexible Investment: Start with as little as ₹1,000, making it accessible to all.
Story Behind the Numbers
Quant Small Cap Fund’s portfolio is diversified across high-potential small-cap stocks in technology, manufacturing, and emerging sectors. A robust stock-picking strategy, combined with dynamic risk management, has resulted in stellar performance.
Example: If you had invested ₹10 lakh five years ago, it would have grown to approximately ₹17.38 lakh today—a testament to the fund’s growth potential.
Who Should Invest?
This fund is ideal for investors with a high-risk appetite and a long-term horizon of 7+ years. It’s a great option if you’re looking to capitalize on India’s small-cap growth story.
2. Motilal Oswal Midcap Fund: The Mid-Cap Maestro
Overview Motilal Oswal Midcap Fund offers a perfect balance between risk and reward. It targets mid-sized companies poised for growth, delivering an impressive 44.09% annualized return.
Key Highlights
- Sector Diversification: Focuses on resilient sectors like FMCG, IT, and healthcare.
- Low Initial Investment: Begin with just ₹500.
- High Transparency: Regular updates and a clear investment strategy make it a trustworthy choice.
Performance Insights
Motilal Oswal’s unique investment philosophy of “Buy Right, Sit Tight” has been a game-changer. The fund’s portfolio includes companies with high Return on Equity (ROE) and robust fundamentals.
Did You Know? Mid-cap stocks historically outperform during economic recovery phases, making this fund a strategic choice in today’s market.
Who Should Invest?
Investors seeking moderate risk and high returns over a 5-10 year period will find this fund a perfect match. It’s an excellent addition to a diversified portfolio.
3. Bandhan Infrastructure Fund: Building the Future
Introduction The Bandhan Infrastructure Fund is a specialized sectoral fund designed for investors who believe in India’s infrastructure growth story. With a focus on sectors like construction, energy, and logistics, this fund has delivered a commendable annualized return of 39.89%.
What Sets It Apart?
- Sector-Specific Growth: Allocates funds to high-growth infrastructure projects.
- Competitive Expense Ratio: At 0.81%, it ensures maximum returns for investors.
- Accessibility: Start investing with as little as ₹500.
Performance Review
India’s infrastructure sector has witnessed significant government and private sector investments in recent years. Bandhan Infrastructure Fund’s performance is a direct reflection of this trend, as it rides on the growth of core industries.
Example:
Investing ₹10 lakh five years ago would now yield approximately ₹15.79 lakh, showcasing the fund’s ability to capitalize on infrastructure growth.
Who Should Invest?
This fund is ideal for long-term investors with moderate to high-risk tolerance, looking to benefit from India’s rapid infrastructure development.
4. Nippon India Small Cap Fund: A Giant in Small Caps
Overview Nippon India Small Cap Fund is another star performer in the small-cap category. With an impressive annualized return of 39.74%, it caters to investors seeking aggressive growth.
Key Features
- Large AUM Base: Manages over ₹61,646 crore, reflecting investor trust.
- Focused Approach: Concentrates on high-potential small-cap stocks.
- Low Initial Investment: Accessible with a minimum of ₹500.
Growth Trajectory
The fund’s success lies in its strategic allocation to emerging companies in sectors like healthcare, chemicals, and industrials. Consistent performance and a diversified portfolio make it a reliable choice.
Pro Tip: Small-cap funds can be volatile. Stick with them for at least 7-10 years to reap maximum benefits.
5. ICICI Prudential Infrastructure Fund: A Solid Performer
Introduction The ICICI Prudential Infrastructure Fund stands out for its robust strategy and focus on India’s infrastructure growth. With a return of 39.70%, it’s a solid pick for thematic investors.
Highlights
- Wide Sector Coverage: Includes construction, energy, and utilities.
- Moderate Expense Ratio: At 1.23%, ensuring balanced returns.
- Investment Flexibility: Start with just ₹500.
Who Should Invest?
Investors with a high-risk appetite and a long-term horizon will benefit from this fund. It’s a good addition to portfolios focusing on sectoral growth.
6. DSP India T.I.G.E.R. Fund: Tapping Into Growth
Overview DSP India T.I.G.E.R. (The Infrastructure Growth and Economic Reforms) Fund is a thematic fund delivering a 39.07% return, focusing on infrastructure and economic reforms.
Key Features
- Thematic Focus: Invests in sectors benefiting from policy reforms.
- Reasonable Expense Ratio: At 0.84%, ensuring value for money.
Insight: Infrastructure spending is a key driver of economic growth, making this fund a strategic choice for long-term investors
7. Nippon India Power & Infra Fund: Energizing Your Portfolio
Why Choose Nippon India Power & Infra Fund? This fund focuses on India’s booming infrastructure and power sectors, making it an ideal choice for long-term investors. With an annualized return of 38.50%, it has proven to be a strong contender in the sectoral space.
Key Features
- Sector-Specific Strategy: Invests in high-growth industries like power generation, infrastructure development, and utilities.
- Moderate Expense Ratio: At 0.95%, it strikes a balance between cost and performance.
- Wide Accessibility: Minimum investment of ₹500 ensures inclusivity for retail investors.
Performance Highlights
The fund’s portfolio includes leading companies in renewable energy, construction, and transportation, aligning with India’s infrastructure push under initiatives like “Make in India” and “Smart Cities Mission.”
Case Study: If you invested ₹10 lakh five years ago, your investment would have grown to ₹15.3 lakh today, showcasing the fund’s growth potential.
Who Should Invest?
This fund suits investors with a high-risk appetite and a horizon of 5-10 years, looking to benefit from India’s infrastructure and energy sector growth.
8. Invesco India Infrastructure Fund: Building Wealth with Infrastructure
Overview Invesco India Infrastructure Fund focuses on sectors driving India’s economic growth, including transportation, energy, and urban development. With a 1-year return of 37.88%, it consistently delivers value.
Key Highlights
- Focused Portfolio: Concentrates on high-performing infrastructure companies.
- Affordable Entry Point: Start investing with as little as ₹500.
- Efficient Cost Management: Expense ratio of 0.71% ensures effective utilization of investor funds.
Performance Analysis
Backed by a research-driven approach, the fund strategically selects stocks with high growth potential. It has demonstrated resilience across market cycles.
Insight: During India’s economic recovery post-pandemic, infrastructure funds like Invesco India have consistently outperformed broader indices.
Who Should Invest?
Investors seeking sector-specific exposure to India’s booming infrastructure space will find this fund appealing, especially with a medium to long-term horizon.
9. Franklin Build India Fund: Crafting a Strong Foundation
Why Franklin Build India Fund Stands Out Franklin Build India Fund leverages India’s rapid urbanization and industrialization, delivering robust returns of 37.47% over the past year.
Key Features
- Thematic Focus: Investments revolve around infrastructure, manufacturing, and allied sectors.
- Moderate Cost: Expense ratio of 0.92%, balancing costs and returns.
- Trusted Name: Franklin Templeton’s legacy of expertise adds credibility.
Performance Insights
The fund’s investments in blue-chip infrastructure companies have ensured steady growth. It thrives on India’s industrial policies and government-led infrastructure initiatives.
Example: A ₹10 lakh investment five years ago would now be worth ₹14.94 lakh, reflecting consistent growth.
Who Should Invest?
This fund is tailored for investors aiming to capitalize on India’s long-term growth story, with a medium to high-risk tolerance.
10. Canara Robeco Infrastructure Fund: A Blend of Growth and Stability
Overview Canara Robeco Infrastructure Fund is a promising choice for those looking to diversify within the infrastructure sector. It has delivered a commendable return of 37.47% over the past year.
Key Highlights
- Concentrated Investments: Focus on sectors like construction, engineering, and transportation.
- Competitive Expense Ratio: At 1.00%, it ensures efficient management of investor funds.
- Legacy of Trust: Backed by Canara Robeco’s decades of experience.
Performance Analysis
The fund has consistently maintained a balanced portfolio, ensuring stability even during volatile market conditions. It thrives on India’s economic reforms and policy-driven initiatives.
Did You Know? Infrastructure funds often benefit from policy changes, making them a strategic investment during government-led growth phases.
Who Should Invest?
Investors with a long-term view, seeking a blend of stability and growth within the infrastructure space, will find this fund ideal.
11. SBI PSU Fund: Banking on Public Sector Growth
Why SBI PSU Fund? SBI PSU Fund is a thematic fund focusing on public sector undertakings (PSUs) that play a pivotal role in India’s economic framework. With a 1-year return of 37.42%, it has emerged as a top performer in its category.
Key Features
- Thematic Focus: Investments in PSU banks, energy, and manufacturing companies.
- Low Entry Point: Begin your investment journey with ₹500.
- Cost-Effective: Expense ratio of 0.76%, ensuring value for money.
Performance Insights
PSU stocks often benefit from government policies and reforms. This fund leverages such opportunities, ensuring steady growth for its investors.
Case in Point: A ₹10 lakh investment five years ago would now be worth ₹14.92 lakh, highlighting the fund’s consistent returns.
Who Should Invest?
This fund is ideal for investors seeking exposure to the public sector with moderate risk tolerance and a medium to long-term horizon
FAQs: Answering Your Burning Questions
- What are mutual funds, and how do they work? Mutual funds pool money from multiple investors to invest in stocks, bonds, or other securities, managed by professional fund managers.
- Which is the best mutual fund for beginners in India? Funds like Quant Small Cap and Motilal Oswal Midcap are great for beginners with a high-risk appetite.
- How are mutual fund returns calculated? Returns are calculated as the percentage change in the Net Asset Value (NAV) over time.
- What is the minimum investment required? Most funds allow investments as low as ₹500 to ₹1000.
Conclusion
Investing in mutual funds is a step toward financial freedom. With the right guidance and informed choices, you can grow your wealth significantly. The 10 best mutual funds in India listed here are proven performers, catering to diverse financial goals. Start small, stay consistent, and watch your investments flourish over time. Happy investing