India's best performing mutual funds for February 2022

2 Mar 2022 , 08:37 AM

If the market were tentatively negative in Jan-22, then the bearishness was affirmative in Feb-22. For the month of Feb-22, Nifty and Mid-Cap Nifty closed with losses of -3.15% and -6.97% respectively. But the bigger stock specific pain of rising oil prices and weak rupee was visible in the small cap index which corrected -11.44% in Feb-22.

For the month of Feb-22, FPIs sold heavily to the tune of Rs35,592cr as the spectre of rising Fed rates spooked global investors. Apart from a rush to safety, most FPIs have been sceptical about Indian markets due to rich valuations and relatively cheaper Asian markets. High inflation has also been a headwind, as has been India’s vulnerability to crude prices.

After the sharp spike in bond yields in Jan-22, Feb was a relatively softer month. In early Feb-22, the 10-year benchmark bond yields got perilously close to the 7% mark but closed the month at more reasonable levels of 6.77%. Markets are now favourably responding to the fact that the Ukraine crisis could force the Fed to be less hawkish on its rates stance. Here is how the major mutual fund categories performed in Feb-22.

1. Equity Large-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (ason 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Axis Blue-Chip Fund (G)	14.693%	17.883%	16.976%
Canara Robeco Blue-Chip (G)	15.138%	19.961%	15.892%
Mirae Asset Large Cap (G)	14.740%	16.306%	14.261%
Data Source: Morningstar

2. Equity Multi-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Active Fund (G)	37.291%	32.343%	22.845%
Sundaram Multi-Cap Fund (G)	28.665%	20.042%	15.118%
Baroda Multi Cap (G)	26.274%	21.267%	13.949%
Data Source: Morningstar

3. Equity Mid-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Axis Mid-Cap Fund (G)	21.838%	23.140%	19.769%
Quant Mid Cap Fund (G)	41.968%	28.860%	19.634%
PGIM India Mid-Cap Fund (G)	32.382%	34.283%	18.679%
Data Source: Morningstar

4. Equity Small-Cap Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Axis Small Cap Fund (G)	39.149%	30.783%	20.533%
SBI Small Cap Fund (G)	26.744%	27.891%	20.487%
Quant Small Cap Fund (G)	54.680%	36.917%	20.486%
Data Source: Morningstar

5. Equity Linked Savings Schemes (Tax Saving)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Tax Plan (G)	38.288%	34.354%	22.263%
BOI AXA Tax Advantage (G)	22.059%	26.365%	18.192%
Mirae Asset Tax Saver (G)	17.716%	21.707%	18.038%
Data Source: Morningstar

6. Balanced Funds (Aggressive Allocation)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Absolute Fund (G)	32.933%	27.686%	18.838%
BOI AXA Mid and Small (G)	33.638%	22.098%	15.112%
ICICI Pru Equity & Debt (G)	28.544%	20.511%	14.492%
Data Source: Morningstar

7. Balanced Funds (Conservative Allocation)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Regular (G)	8.571%	9.915%	9.071%
Kotak Debt Hybrid (G)	10.658%	12.393%	9.063%
Canara Robeco Hybrid (G)	8.001%	11.012%	8.620%
Data Source: Morningstar

8. Arbitrage Funds (Cash-Futures)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Nippon India Arbitrage (G)	4.190%	4.712%	5.326%
Kotak Arbitrage Fund (G)	4.309%	4.778%	5.319%
BNP Paribas Arbit Fund (G)	3.930%	4.757%	5.292%
Data Source: Morningstar

9. Government Securities Funds (Gilt Funds)

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ABSL G-Sec Fund (G)	6.368%	8.803%	7.980%
IDFC G-Sec Fund (G)	5.267%	9.836%	7.974%
Edelweiss G-Sec Fund (G)	5.852%	9.490%	7.830%
Data Source: Morningstar

10. Corporate Bond Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
L&T Triple Ace Bond Fund (G)	6.502%	9.640%	7.714%
ABSL Corporate Bond (G)	5.347%	8.250%	7.710%
HDFC Corporate Bond (G)	5.350%	8.341%	7.631%
Data Source: Morningstar

11. Credit Risk Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Credit Risk Fund (G)	7.072%	8.552%	7.751%
HDFC Credit Risk Fund (G)	7.310%	8.862%	7.593%
Baroda Credit Risk Fund (G)	18.916%	7.820%	7.327%
Data Source: Morningstar

12. Liquid Funds

Top performing Regular Plans (Growth Option) on 5-year returns (as on 28th Feb-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Liquid Plan (G)	3.931%	5.115%	5.855%
IDBI Liquid Fund (G)	3.456%	4.639%	5.609%
Mahindra Manulife Liquid (G)	3.377%	4.553%	5.556%
Data Source: Morningstar

In Feb-22 equity fund returns were once again negatively impacted across large caps and mid-caps. While the FPI selling impacted the larger stocks, the selling by retail and HNI investors hit mid-cap and small cap stocks. In line with the weak index performance of smaller categories of stocks, the mid-cap funds and small cap funds saw the maximum damage in terms of one-year returns. Longer term returns were not impacted meaningfully.

Bond funds were the surprise package in Feb-22, with most of them improving their one-year returns. That was due to yields tapering from near 7% to 6.77% in the last week as Ukraine war fears reduced the probability of aggressive rate hikes by the Fed. However, it would be useful to keep a close watch on the emerging retail inflation data, as that is likely to have a strong bearing on benchmark bond yields.