India’s top performing mutual fund schemes in May 2023

1 Jun 2023 , 11:16 AM

Record FPI inflows of over $5 billion combined with a sharp revival in banking and financial stocks led the Nifty and Sensex sharply higher. For the month of May 2023, the markets were decisively in the positive once again. The Nifty and Sensex ended May 2023 with gains of 2.60% and 2.47% respectively. Even better, were the Mid cap index gaining 6.19% and the Small Cap index surging by 5.10% in the month of May 2023. Stock gains were across the board, but smaller stocks held the momentum.

Bond markets saw an extremely sharp tapering of yields. In mid-March, the 10-year yields had jumped to 7.50% before settling at 7.32% by close of March. However, the nature of the bond yields changed sharply after the RBI maintained status quo on yields. This led to the bond yields falling sharply to below 7.10% towards the end of April 2023. However, by the close of May 2023, 10 year bond yields had dipped to as low as 6.98%. Let us now turn to the May-23 mutual fund performance; in equity and debt funds.

1. Equity Large-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Canara Robeco Blue-Chip (G)	14.047%	24.457%	15.011%
Baroda BNP Large Cap (G)	13.918%	23.213%	13.556%
Kotak Bluechip Fund (G)	13.721%	26.537%	13.404%
Category Average	13.024%	23.992%	11.460%
BSE 100 (TR) Index	13.490%	26.623%	12.846%
Data Source: Morningstar

1. Equity Multi-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Active Fund (G)	13.831%	41.205%	21.548%
Mahindra Manulife Multi (G)	14.453%	32.756%	17.261%
Nippon India Multi Cap (G)	26.029%	40.185%	15.314%
Category Average	16.938%	30.917%	14.443%
BSE 500 (TR) Index	12.852%	28.008%	12.588%
Data Source: Morningstar

1. Equity Flexi-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Flexi Cap Fund (G)	17.609%	41.984%	19.921%
PPFAS Flexi Cap Fund (G)	17.710%	30.627%	19.149%
PGIM India Flexi Cap Fund (G)	13.633%	31.409%	16.905%
Category Average	13.447%	25.807%	12.349%
BSE 500 (TR) Index	12.852%	28.008%	12.588%
Data Source: Morningstar

1. Equity Mid-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Mid-Cap Fund (G)	16.125%	40.705%	20.987%
PGIM India Mid-Cap Fund (G)	14.321%	41.764%	19.608%
MOSL Mid-Cap 30 (G)	29.261%	42.647%	18.096%
Category Average	17.055%	33.134%	13.943%
BSE Midcap (TR) Index	18.552%	33.247%	12.363%
Data Source: Morningstar

1. Equity Small-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Small Cap Fund (G)	27.440%	65.882%	25.912%
Axis Small Cap Fund (G)	20.140%	40.081%	21.342%
Nippon Small Cap Fund (G)	28.014%	50.835%	19.511%
Category Average	20.091%	43.501%	15.719%
BSE Midcap (TR) Index	16.757%	42.113%	13.137%
Data Source: Morningstar

1. Equity Linked Savings Schemes (Tax Saving)     

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Tax Plan (G)	12.740%	45.050%	23.601%
Mirae Asset Tax Saver (G)	12.237%	30.385%	16.287%
Canara Robeco Tax Saver (G)	14.501%	28.188%	16.267%
Category Average	13.869%	26.519%	11.653%
BSE 200 (TR) Index	12.575%	27.080%	12.818%
Data Source: Morningstar

1. Index Funds (Equity)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Nippon India Sensex Fund (G)	13.787%	25.653%	13.133%
HDFC India Sensex Fund (G)	13.765%	25.723%	13.105%
ICICI Pru Sensex Fund (G)	13.706%	25.546%	13.102%
Category Average	12.829%	25.476%	11.775%
Benchmark Index	N.A.	N.A.	N.A.
Data Source: Morningstar

1. Balanced Funds (Aggressive Allocation)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Absolute Fund (G)	10.850%	35.352%	19.649%
ICICI Pru Equity & Debt (G)	14.066%	29.352%	15.525%
Baroda BNP Paribas AEH (G)	13.291%	20.686%	14.086%
Category Average	12.292%	22.057%	10.901%
CRISIL MIF Blended Index PR	9.516%	8.359%	8.841%
Data Source: Morningstar

1. Balanced Funds (Conservative Allocation)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Kotak Debt Hybrid (G)	11.753%	13.914%	10.885%
Canara Robeco Hybrid (G)	8.971%	10.951%	9.830%
SBI Conservative Hybrid (G)	10.864%	14.030%	9.694%
Category Average	8.526%	10.875%	7.320%
CRISIL MIP Blended Index PR	9.516%	8.359%	8.841%
Data Source: Morningstar

1. Dynamic Asset Allocation Funds (BAF)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
HDFC BAF (G)	19.512%	29.260%	13.869%
Edelweiss BAF (G)	11.752%	19.006%	12.289%
ICICI Prudential BAF (G)	10.885%	18.377%	10.849%
Category Average	10.665%	15.176%	8.776%
Benchmark Index	N.A.	N.A.	N.A.
Data Source: Morningstar

1. Arbitrage Funds (Cash-Futures)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Edelweiss Equity Arbitrage (G)	6.323%	4.827%	5.824%
Nippon Arbitrage Fund (G)	6.262%	4.800%	5.749%
Invesco Arbitrage Fund (G)	6.771%	4.991%	5.717%
Category Average	5.582%	4.066%	4.991%
Benchmark Index	N.A.	N.A.	N.A.
Data Source: Morningstar

1. Government Securities Funds (Gilt Funds)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
DSP G-Sec Fund (G)	8.410%	5.153%	9.009%
Bandhan G-Sec Fund (G)	8.224%	4.776%	8.995%
SBI Magnum Gilt Fund (G)	9.884%	5.555%	8.872%
Category Average	7.942%	4.397%	7.714%
I-SEC MIBEX Index TR	8.297%	5.046%	7.997%
Data Source: Morningstar

1. Corporate Bond Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
HSBC Corporate Bond (G)	8.287%	5.260%	8.294%
HDFC MF Corporate Bond (G)	7.369%	5.934%	7.768%
ABSL Corporate Bond (G)	7.269%	6.116%	7.764%
Category Average	6.778%	5.432%	6.932%
CRISIL ST Bond Fund Index PR	7.000%	5.550%	7.252%
Data Source: Morningstar

1. Credit Risk Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Credit Risk Fund (G)	7.578%	7.789%	8.316%
HDFC Credit Risk Fund (G)	7.385%	8.191%	8.120%
Baroda Credit Risk Fund (G)	7.843%	12.827%	7.804%
Category Average	7.301%	10.196%	4.843%
CRISIL ST Bond Fund Index PR	7.000%	5.550%	7.252%
Data Source: Morningstar

1. Liquid Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st May-23):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Liquid Plan (G)	6.200%	5.013%	5.887%
Mahindra Manulife Liquid (G)	6.388%	4.469%	5.418%
IDBI Liquid Fund (G)	6.286%	4.450%	5.414%
Category Average	5.499%	3.875%	4.827%
CRISIL Liquid Fund Index PR	6.407%	4.632%	5.525%
Data Source: Morningstar

 

Here are some key takeaways from the May 2023 mutual fund rankings.

1. Most equity funds have given much better 1 year return compared to the previous month and that can be attributed to the sharp rally in equity indices in May 2023. Longer period returns have been more stable. The performance impact has been a lot more pronounced in the case of small cap and mid cap funds.

    

2. An interesting observation is that; across most of the key categories, the top-3 funds have comfortably beaten the benchmark index returns on TRI basis. This is indicative of alpha generation by the category leaders on a consistent basis. Across equity categories, the median returns have also been better than the index returns.

    

3. Debt funds have given better returns on a 1-year basis compared to last month. That is because bond  yields fell sharply from above 7.5% to below 6.9% in last 70 days. That has boosted bond yields and the impact is more visible in short term returns.

The big takeaway, however, is that rankings across equity and debt categories have been consistent over the past few months; barring a handful of exceptions. That only goes to show that past returns in this case are a reliable indicator of future performance; something that adds a lot of value from an advisory perspective. That is the big takeaway.