The growing popularity of midcap SIPs highlights a shift in how Indian investors are approaching equity investments. Investors appear to be increasingly willing to take on additional market risk in pursuit of higher long-term growth.
According to the AMFI-Crisil Factbook 2026, midcap funds became the largest SIP category by March 2026, accounting for around 13% of total SIP assets. Large-cap funds, meanwhile, accounted for about 10%. Five years earlier, in March 2021, large-cap funds had the biggest share of the SIP category at 16%.
Midcap SIP Assets Rise Sharply
The increase is also visible in the value of SIP assets. Midcap SIP assets rose from around ₹51,627 crore in March 2021 to approximately ₹1.97 lakh crore by March 2026.
Large-cap SIP assets also increased during the same period, rising from ₹68,206 crore to around ₹1.51 lakh crore. However, their share of the overall SIP pool declined as midcap investments grew at a faster pace.
Ajay Kumar Yadav, CFP, Group CEO & CIO, Wise Finserv, said the change could partly be linked to the wealth creation investors have experienced in the midcap segment over the past several years.
But how does this difference translate into actual investment values for someone investing ₹10,000 every month?
₹10,000 Monthly SIP: Large Cap vs Midcap
A historical illustration using the Nifty 100 TRI for large caps and the Nifty Midcap 150 TRI for midcaps shows how the two categories have performed over different investment periods.
| SIP Period | Total Invested | Nifty 100 TRI | Nifty Midcap 150 TRI |
|---|---|---|---|
| 3 years | ₹3.60 lakh | ₹3.85 lakh | ₹4.33 lakh |
| 5 years | ₹6.00 lakh | ₹7.43 lakh | ₹9.33 lakh |
| 7 years | ₹8.40 lakh | ₹12.76 lakh | ₹18.14 lakh |
| 10 years | ₹12.00 lakh | ₹22.41 lakh | ₹33.02 lakh |
The calculation assumes an SIP of ₹10,000 every month, with investment values calculated as of August 31, 2026. Returns have been calculated using the XIRR methodology.
For example, an investor contributing ₹10,000 each month for 10 years would have invested ₹12 lakh in total. Based on the historical illustration, this amount would have grown to approximately ₹22.41 lakh in the Nifty 100 TRI and around ₹33.02 lakh in the Nifty Midcap 150 TRI as of August 31, 2026.
That represents a difference of roughly ₹10.6 lakh despite the monthly contribution and total investment being identical.
The 10-year SIP return works out to approximately 12% annually for the Nifty 100 TRI, compared with 19.22% for the Nifty Midcap 150 TRI. Over five years, the corresponding SIP returns were around 8.47% and 17.68%, respectively.
Midcaps Can Offer Growth but With Higher Volatility
The historical numbers, however, do not mean that midcap stocks or funds will always outperform large caps.
Yadav pointed out that the possibility of higher returns comes with greater volatility. Midcap companies can experience sharper price movements when markets correct, liquidity conditions tighten or earnings expectations change. Investors therefore need to be prepared for periods of significant market fluctuations.
Large-cap companies continue to have an important role in an equity portfolio. They generally consist of established businesses with greater liquidity and relatively stable earnings. Midcaps, on the other hand, can provide an additional growth component.
The key risk for investors is focusing only on recent five- or ten-year returns and moving heavily into midcaps based on past performance. SIPs can help spread investments across different market levels, but they do not eliminate market or valuation risks.
Large Cap and Midcap Funds Can Both Have a Role
The comparison does not necessarily have to be about choosing between large caps and midcaps. Both categories can form part of an investor’s portfolio, depending on individual circumstances.
Large caps can provide relative stability, while midcaps can offer greater growth potential along with higher volatility. The appropriate allocation depends on factors such as an investor’s investment horizon, financial goals, overall asset allocation and ability to tolerate market fluctuations.
Historical returns can provide useful insight into how different market segments have performed in the past, but they should not be treated as an indication of what returns investors will receive over the next five or ten years.
Disclaimer: The figures and historical examples mentioned in this article are for informational purposes only and are based on past market performance. Historical returns are not guaranteed to continue in the future. Mutual funds and equity investments are subject to market and valuation risks, and investors should consider their financial goals, risk tolerance and investment horizon before making investment decisions.