10 Mutual Funds That Delivered Up to 47% Returns Post-Interim Budget

Since Finance Minister Nirmala Sitharaman presented the interim budget on February 1, 2024, equity mutual funds have seen impressive returns, reaching up to 47%. Approximately 474 equity mutual funds were active during this period.

Leading the pack, the HDFC Defence Fund delivered a remarkable 47.04% return, followed by Bandhan Infra with 35.59%, LIC MF Infra at 34.61%, and Motilal Oswal Midcap at 31.54%.

The top three performers belonged to the sectoral/thematic mutual fund category, with about five funds achieving returns above 30%. The HDFC Defence Fund stood out with the highest return of 47.04% with its unique focus on the defense sector.

Experts attribute this stellar performance to the growing global military significance due to geopolitical tensions like the Russia-Ukraine war, Israel's Gaza offensive, and conflicts in the Middle East. The shift towards a multipolar world, with Asia Pacific economies challenging Western military dominance and rising protectionism in defense, also played a role. Additionally, India's defense challenges, including terrorism, border security, and extensive coastline protection, have been contributing factors.

The Bandhan Infrastructure Fund and LIC MF Infra Fund returned 35.59% and 34.61%, respectively. The Motilal Oswal Midcap Fund achieved a 31.54% return, while the Canara Robeco Infrastructure Fund provided a 30.57% return.

A mutual fund advisor pointed out that infrastructure funds have benefited from substantial government capital expenditure on infrastructure projects. The Union Budget 2023-24 and the interim budget for 2024-25 allocated ₹10 lakh crore and ₹11.1 lakh crore, respectively, significantly boosting these sectors. Reforms in power, railways, and defense have also driven growth in the infrastructure sector. Check Budget 2024 - Union Budget Live Updates

The Invesco India PSU Equity Fund, the oldest PSU fund, offered a 29.95% return since the interim budget. Experts explained that rising commodity prices have improved the financials in sectors like oil, gas, and metals, enhancing profitability. Stable cash flows and low debt levels of PSUs further contribute to their robust performance.

The international fund Mirae Asset NYSE FANG+ETF FoF delivered a 29.62% return since the interim budget. The HDFC Mid-Cap Opportunities Fund, the largest mid-cap fund based on assets managed, offered a 17.53% return, while the Axis ELSS Tax Saver Fund, the largest ELSS fund based on assets managed, delivered a 17.45% return.

The SBI BlueChip Fund provided a 15.64% return during the same period. The Parag Parikh Flexi Cap Fund, the largest flexi cap fund by assets managed, achieved a 14.40% return since the interim budget.

Two schemes from Mirae Asset Mutual Fund - the Mirae Asset Healthcare Fund and Mirae Asset Multicap Fund - each returned 13.90% since February 1, 2024. Only two schemes recorded negative returns during this period, both from the same category: the HSBC Brazil Fund and the Mahindra Manulife Asia Pacific REITs FOF lost 9.76% and 2.11%, respectively.