Popular equity categories lag in FY25; pharma schemes returned much more than the rest

Pharma sector funds emerged as the top performing category among mutual funds in the financial year ended March 31, 2025, outperforming plain vanilla equity schemes. The risk-off sentiment in the second half of the financial year eroded a chunk of the returns in the most popular equity categories such as large-caps, midcap and small-cap schemes.

The value of pharma schemes rose as investors shifted focus to drugmakers, considered defensive in uncertain times. As per data from Value Research the mid-cap category offered the highest return of 8.93%, followed by multi-caps which returned 7.88%.

Small-caps and flexi-caps lagged, returning about 6.61% and 6.62%, respectively. The large-cap category returned the lowest of 5.47%, while the broad Nifty 50 benchmark returned 6.55%.

Agencies

Multi-asset allocation outperformed several equity-fund categories because of their exposure to gold, which beat most asset classes.

Amongst the hybrid funds, multi-asset funds that mix equity, debt and gold returned 9.4% followed by balanced and aggressive hybrid categories that returned 8.81% and 8.22%.