Equity mutual fund investments saw a shift in investor flows in September 2026, with large-cap, dividend yield and sectoral funds all recording net inflows after experiencing outflows in August. According to the latest data from the Association of Mutual Funds in India (AMFI), sectoral funds attracted the highest investments during the month.
However, the improvement in fund flows did not translate into stronger returns across all categories. Large-cap and dividend yield funds continued to face market pressure, with both categories reporting negative monthly and year-to-date returns as of October 13, 2026.
How Did the Three Mutual Fund Categories Perform?
The September figures show a clear change in investment flows across the three equity mutual fund categories.
| Fund category | August flows | September flows | September returns | YTD returns | 3-year returns | 5-year returns |
|---|---|---|---|---|---|---|
| Large-cap funds | -₹1,147.36 crore | ₹859.47 crore | -5.83% | -8.96% | 7.97% | 6.75% |
| Dividend yield funds | -₹133.57 crore | ₹179.31 crore | -4.97% | -6.04% | 10.48% | 10.48% |
| Sectoral funds | -₹53.19 crore | ₹1,840.02 crore | N/A | N/A | N/A | N/A |
Source: AMFI, Value Research and Morningstar. Category-average returns are based on data as of October 13, 2026. Sectoral fund returns are not shown as a single category average because performance differs across industries.
Sectoral funds topped the September inflow chart with ₹1,840.02 crore, followed by large-cap funds at ₹859.47 crore and dividend yield funds at ₹179.31 crore. In August, these categories had recorded net outflows of ₹53.19 crore, ₹1,147.36 crore and ₹133.57 crore, respectively.
Despite the improved inflows, large-cap funds declined 5.83% in September, taking their year-to-date losses to 8.96%. Dividend yield funds also fell 4.97% during the month and were down 6.04% for the year to date.
Best-Performing Large-Cap Mutual Fund Schemes
Large-cap mutual funds remained under pressure during September. According to the reported data, no scheme in this category delivered positive monthly returns, while only two recorded positive year-to-date performance.
The following schemes featured among the leading performers over different investment periods.
| Investment period | Top-performing schemes | Returns |
|---|---|---|
| YTD | Taurus Largecap Equity Fund | 3.23% |
| YTD | Quant Large Cap Fund | 0.56% |
| 3 years | Quant Large Cap Fund | 12.26% |
| 3 years | WhiteOak Capital Large Cap Fund | 12.04% |
| 3 years | Bandhan Large Cap Fund | 11.66% |
| 5 years | Nippon India Large Cap Fund | 11.26% |
| 5 years | Invesco India Large Cap Fund | 9.98% |
| 5 years | Taurus Largecap Equity Fund | 9.60% |
| 5 years | ICICI Prudential Large Cap Fund | 9.57% |
| 5 years | Bandhan Large Cap Fund | 9.06% |
Source: Value Research and Morningstar. Direct plans; CAGR as of October 13, 2026. The figures are reproduced from the supplied data.
Taurus Largecap Equity Fund appeared among the leading schemes across the reported investment periods. Bandhan Large Cap Fund also featured in both the three-year and five-year rankings.
Dividend Yield Funds: Which Schemes Led Returns?
Dividend yield funds also experienced a weak September, although a few schemes managed to post positive returns. WhiteOak Capital Dividend Yield Fund recorded a monthly return of 0.54%, while Tata Dividend Yield Fund gained 1.78%.
The year-to-date and longer-term rankings highlighted the following schemes:
| Investment period | Leading scheme | Returns |
|---|---|---|
| September 2026 | WhiteOak Capital Dividend Yield Fund | 0.54% |
| September 2026 | Tata Dividend Yield Fund | 1.78% |
| YTD | LIC MF Dividend Yield Fund | 2.99% |
| 3 years | LIC MF Dividend Yield Fund | 17.42% |
| 3 years | ICICI Prudential Dividend Yield Fund | 13.05% |
| 3 years | Tata Dividend Yield Fund | 12.84% |
| 3 years | UTI Dividend Yield Fund | 11.55% |
| 3 years | Aditya Birla Sun Life Dividend Yield Fund | 10.07% |
| 5 years | ICICI Prudential Dividend Yield Fund | 14.23% |
| 5 years | LIC MF Dividend Yield Fund | 13.57% |
| 5 years | Tata Dividend Yield Fund | 12.19% |
| 5 years | HDFC Dividend Yield Fund | 11.79% |
| 5 years | Aditya Birla Sun Life Dividend Yield Fund | 11.47% |
Source: Value Research and Morningstar. Direct plans; CAGR as of October 13, 2026. The rankings and returns are based on the supplied figures.
LIC MF and Tata Dividend Yield Funds featured among the leading schemes across multiple investment horizons. WhiteOak Capital Dividend Yield Fund led the reported September monthly rankings but did not appear among the top performers over the other periods.
Sectoral Mutual Funds Lead Longer-Term Performance Rankings
Sectoral funds invest in specific industries, such as healthcare, pharmaceuticals and transportation. Their performance can therefore vary significantly depending on the sectors in which they invest.
The reported rankings showed several healthcare-focused schemes among the leading performers over one-, three- and five-year periods.
| Investment period | Fund | Returns |
|---|---|---|
| 1 year | Kotak Healthcare Fund | 22.47% |
| 1 year | HDFC Pharma and Healthcare Fund | 21.60% |
| 1 year | SBI Automotive Opportunities Fund | 19.75% |
| 1 year | PGIM India Healthcare Fund | 18.71% |
| 1 year | WhiteOak Capital Pharma and Healthcare Fund | 16.81% |
| 3 years | HDFC Pharma and Healthcare Fund | 28.84% |
| 3 years | HDFC Transportation and Logistics Fund | 22.20% |
| 3 years | SBI Healthcare Opportunities Fund | 22.05% |
| 3 years | Mirae Asset Healthcare Fund | 21.69% |
| 3 years | UTI Healthcare Fund | 21.68% |
| 5 years | SBI Healthcare Opportunities Fund | 17.28% |
| 5 years | UTI Transportation and Logistics Fund | 16.08% |
| 5 years | DSP Healthcare Fund | 15.18% |
| 5 years | ICICI Prudential Healthcare Fund | 15.14% |
| 5 years | Mirae Asset Healthcare Fund | 14.93% |
Source: Value Research and Morningstar. Direct plans; CAGR as of October 13, 2026.
HDFC Pharma and Healthcare Fund appeared in both the one-year and three-year rankings. SBI Healthcare Opportunities Fund and Mirae Asset Healthcare Fund featured in the three-year and five-year lists.
What the September Mutual Fund Data Indicates
The return of net inflows across all three categories suggests that investor allocations changed in September. However, stronger inflows alone do not establish that fund performance has recovered.
The rankings also show that some schemes have maintained strong positions over multiple investment periods, particularly in the healthcare and dividend yield categories. Investors should remember that historical returns can change with market conditions and do not guarantee future performance.
Disclaimer: This article is for informational and educational purposes only and should not be considered investment advice. Mutual fund investments are subject to market risks. Investors should review scheme documents, understand their risk tolerance and consult a qualified financial adviser before making investment decisions.