Pharma mutual funds are specialty equity funds that focus on investments in the pharmaceutical and healthcare-related sectors, including companies involved in biotechnology, hospital management and health maintenance organizations (HMOs). As sectoral funds they are mandated by SEBI rules to allocate at least 80% of their assets to specific sectors irrespective of market performance.
While this thematic focus offers the potential for high returns during periods of sector growth, it exposes investors to significant risk, particularly during downturns. Investors should be aware of this inherent volatility when choosing pharma funds. Pharma mutual funds are among the best performing funds that consistently outperform their peers and benchmark indices, reflecting strong fund management and sectoral expertise.
Best Pharma mutual funds
India’s pharmaceutical sector is one of the largest and most promising industries globally, known for its generic drugs and medical supplies. With the growing demand for domestic and international healthcare products, pharma companies are poised for long-term growth.
Investors often look for top pharmaceutical stocks in India as a stable and potentially profitable opportunity. We will talk about the 5 best pharma mutual funds.
1. ICICI Prudential Pharma Healthcare and Diagnostics (P.H.D) Fund Direct – Growth
ICICI Prudential Pharma Healthcare & Diagnostics (P.H.D) Fund Direct – Growth is an equity mutual fund launched on July 12, 2018. Investors can start investing in this fund with a minimum SIP of ₹100 or a Lumpsum investment of ₹5,000. The fund currently manages total assets of ₹5,044.63 crore and its current NAV as on January 03, 2025 is ₹42.9600.
In the last 1 year, the fund has delivered an absolute return of 44.70%, while in the last 3 years it has delivered a CAGR of 25.32% and in the last 5 years it has delivered a CAGR of 32.10%. The fund has an expense ratio of 1.09%. The fund’s top holdings include Sun Pharmaceuticals 13.77%, Dr. Reddy’s Laboratories 8.48%, Cipla 7.94%, Arvind Pharma 5.04%, and Gland Pharma 4.38%.
| Fund Details | Description |
|---|---|
| Minimum SIP Amount | ₹100.00 |
| Minimum Lumpsum Amount | ₹5,000.00 |
| Assets Under Management (AUM) | ₹5,044.63 Crores |
| Expense Ratio | 1.09% |
| Lock-in Period | None |
| Inception Date | 12 July 2018 |
| Fund Age | 6 Years |
| Benchmark | BSE Healthcare TRI |
| Scheme Type | Open Ended |
| Stamp Duty | 0.005% (effective from July 1st, 2020) |
| Exit Load | 1.00% if redeemed or switched out within 15 days from the date of allotment |
| Tax Implication | STCG: 20% if redeemed within 1 year; LTCG: 12.5% if returns exceed ₹1.25 Lakhs in a financial year |
| Stock Invested in | Sector | Value (Mn) | % of Total Holdings |
|---|---|---|---|
| Sun Pharmaceutical Industries Ltd. | Pharmaceuticals | 6946.4 | 13.77% |
| Dr. Reddys Laboratories Ltd. | Pharmaceuticals | 4278.5 | 8.48% |
| Cipla Ltd. | Pharmaceuticals | 4005.9 | 7.94% |
| Aurobindo Pharma Ltd. | Pharmaceuticals | 2544.0 | 5.04% |
| Gland Pharma Ltd. | Pharmaceuticals | 2208.1 | 4.38% |
| Lupin Ltd. | Pharmaceuticals | 2164.7 | 4.29% |
| Alkem Laboratories Ltd. | Pharmaceuticals | 2101.0 | 4.16% |
| Zydus Lifesciences Ltd. | Pharmaceuticals | 1563.8 | 3.10% |
| Apollo Hospitals Enterprises Ltd. | Hospital | 1479.3 | 2.93% |
| Biocon Ltd. | Pharmaceuticals | 1207.5 | 2.39% |
2. Nippon India Pharma Fund Direct – Growth
Nippon India Pharma Fund Direct – Growth is an equity mutual fund launched on 01 January 2013. Investors can start investing in this fund with a minimum SIP of ₹100 or a Lumpsum investment of ₹5,000. The fund currently manages total assets of ₹8,638.23 crore and its NAV as on 03 January 2025 is ₹584.4781.
In the last 1 year, the fund has delivered an absolute return of 31.18%, while in the last 3 years it has delivered a CAGR of 20.10% and in the last 5 years it has delivered a CAGR of 29.14%. The fund has an expense ratio of 0.91%. Out of total AUM, its top holdings include Sun Pharmaceuticals at 13.52%, Divis Laboratories at 9.65%, Lupin at 7.61%, Cipla at 5.50%, and Apollo Hospitals at 5.13%.
| Fund Details | Description |
|---|---|
| Minimum SIP Amount | ₹100.00 |
| Minimum Lumpsum Amount | ₹5,000.00 |
| Assets Under Management (AUM) | ₹8,638.23 Crores |
| Expense Ratio | 0.91% |
| Lock-in Period | None |
| Inception Date | 01 January 2013 |
| Fund Age | 12 Years |
| Benchmark | BSE Healthcare TRI |
| Scheme Type | Open Ended |
| Stamp Duty | 0.005% (effective from July 1st, 2020) |
| Exit Load | 1% if redeemed or switched out on or before 1 month from the date of allotment |
| Tax Implication | STCG: 20% if redeemed within 1 year; LTCG: 12.5% if returns exceed ₹1.25 Lakhs in a financial year |
| Stock Invested in | Sector | Value (Mn) | % of Total Holdings |
|---|---|---|---|
| Sun Pharmaceutical Industries Ltd. | Pharmaceuticals | 11,676.2 | 13.52% |
| Divis Laboratories Ltd. | Pharmaceuticals | 8,338.1 | 9.65% |
| Lupin Ltd. | Pharmaceuticals | 6,569.9 | 7.61% |
| Cipla Ltd. | Pharmaceuticals | 4,755.1 | 5.50% |
| Apollo Hospitals Enterprises Ltd. | Hospital | 4,430.6 | 5.13% |
| Dr. Reddys Laboratories Ltd. | Pharmaceuticals | 4,403.0 | 5.10% |
| Vijaya Diagnostic Centre Ltd. | Healthcare service provider | 3,529.5 | 4.09% |
| Ajanta Pharma Limited | Pharmaceuticals | 2,899.6 | 3.36% |
| Medplus Health Services Ltd. | Pharmacy retail | 2,790.1 | 3.23% |
| Gland Pharma Ltd. | Pharmaceuticals | 2,607.0 | 3.02% |
3. HDFC Pharma And Healthcare Fund Direct – Growth
HDFC Pharma & Healthcare Fund Direct – Growth is an equity mutual fund scheme launched on 04 October 2023. Investors can start investing in this fund with a minimum SIP of ₹100 or lumpsum investment of ₹100. The fund currently manages total assets of ₹1,459.59 crore and its NAV as on 03 January 2025 is ₹17.3720. In the last 1 year, the fund has given a return of 49.04%. The fund has an expense ratio of 0.92%. Out of the total AUM, its top holdings include Sun Pharmaceuticals 13.48%, Divis Laboratories 7.85%, Cipla 7.75%, Lupin 5.80%, and Gland Pharma 3.99%.
| Fund Details | Description |
|---|---|
| Minimum SIP Amount | ₹100.00 |
| Minimum Lumpsum Amount | ₹100.00 |
| Assets Under Management (AUM) | ₹1,459.59 Crores |
| Expense Ratio | 0.92% |
| Lock-in Period | None |
| Inception Date | 04 October 2023 |
| Fund Age | 1 Year |
| Benchmark | BSE Healthcare TRI |
| Scheme Type | Open Ended |
| Stamp Duty | 0.005% (effective from July 1st, 2020) |
| Exit Load | 1% if redeemed or switched out within 30 days from the date of allotment |
| Tax Implication | STCG: 20% if redeemed within 1 year; LTCG: 12.5% if returns exceed ₹1.25 Lakhs in a financial year |
| Stock Invested in | Sector | Value (Mn) | % of Total Holdings |
|---|---|---|---|
| Sun Pharmaceutical Industries Ltd. | Pharmaceuticals | 1,968.1 | 13.48% |
| Divis Laboratories Ltd. | Pharmaceuticals | 1,145.7 | 7.85% |
| Cipla Ltd. | Pharmaceuticals | 1,131.0 | 7.75% |
| Lupin Ltd. | Pharmaceuticals | 847.2 | 5.80% |
| Gland Pharma Ltd. | Pharmaceuticals | 582.7 | 3.99% |
| Ipca Laboratories Ltd. | Pharmaceuticals | 547.1 | 3.75% |
| Aster DM Healthcare Ltd. | Hospital | 520.6 | 3.57% |
| Vijaya Diagnostic Centre Ltd. | Healthcare service provider | 516.3 | 3.54% |
| Eris Lifesciences Ltd. | Pharmaceuticals | 492.8 | 3.38% |
| Glenmark Pharmaceuticals Ltd. | Pharmaceuticals | 491.6 | 3.37% |
4. Tata India Pharma & Healthcare Fund Direct – Growth
Tata India Pharma & Healthcare Fund Direct – Growth is an equity mutual fund scheme launched on December 28, 2015. Investors can start investing in this fund with a minimum SIP of ₹100 or a one-time investment of ₹5,000. The fund currently manages total assets of ₹1,213.92 crore and its NAV as on January 03, 2025 is ₹36.6840. The fund has given returns of 38.82% in the last 1 year, a CAGR of 22.71% in the last 3 years and a CAGR of 29.79% in the last 5 years. The fund has an expense ratio of 0.69%. The fund’s top holdings include Sun Pharmaceuticals (11.80%), Aurobindo Pharma (7.71%), Lupin (6.93%), Cipla (6.19%) and Dr. Reddy’s Laboratories (6.09%).
| Fund Details | Description |
|---|---|
| Minimum SIP Amount | ₹100.00 |
| Minimum Lumpsum Amount | ₹5,000.00 |
| Assets Under Management (AUM) | ₹1,213.92 Crores |
| Expense Ratio | 0.69% |
| Lock-in Period | None |
| Inception Date | 28 December 2015 |
| Fund Age | 9 Years |
| Benchmark | Nifty Pharma TRI |
| Scheme Type | Open Ended |
| Stamp Duty | 0.005% (effective from July 1st, 2020) |
| Exit Load | 0.25% of NAV if redeemed/switched out before 30 days from the date of allotment |
| Tax Implication | STCG: 20% if redeemed within 1 year; LTCG: 12.5% if returns exceed ₹1.25 Lakhs in a financial year |
| Stock Invested in | Sector | Value (Mn) | % of Total Holdings |
|---|---|---|---|
| Sun Pharmaceutical Industries Ltd. | Pharmaceuticals | 1,432.4 | 11.80% |
| Aurobindo Pharma Ltd. | Pharmaceuticals | 935.6 | 7.71% |
| Lupin Ltd. | Pharmaceuticals | 841.3 | 6.93% |
| Cipla Ltd. | Pharmaceuticals | 751.6 | 6.19% |
| Dr. Reddys Laboratories Ltd. | Pharmaceuticals | 738.9 | 6.09% |
| Divis Laboratories Ltd. | Pharmaceuticals | 647.9 | 5.34% |
| Fortis Healthcare Ltd. | Hospital | 563.7 | 4.64% |
| Zydus Lifesciences Ltd. | Pharmaceuticals | 455.2 | 3.75% |
| Alkem Laboratories Ltd. | Pharmaceuticals | 424.6 | 3.50% |
| Apollo Hospitals Enterprises Ltd. | Hospital | 402.2 | 3.31% |
5. SBI Healthcare Opportunities Fund Direct – Growth
SBI Healthcare Opportunities Fund Direct – Growth is an equity mutual fund scheme launched on 01 January 2013. Investors can start investing in this fund with a minimum SIP of ₹500 or a one-time investment of ₹5,000. The fund currently manages total assets of ₹3,459.68 crore and its NAV as on 03 January 2025 is ₹501.3956. In the last 1 year, the fund has given an absolute return of 42.36%, a CAGR of 24.39% in the last 3 years and a CAGR of 31.18% in the last 5 years. The fund has an expense ratio of 0.89%. The fund’s top holdings include Sun Pharmaceuticals (12.87%), Divis Laboratories (6.42%), Cipla (5.68%), Max Healthcare Institute (5.66%), and Lupin (4.74%).
| Fund Details | Description |
|---|---|
| Minimum SIP Amount | ₹500.00 |
| Minimum Lumpsum Amount | ₹5,000.00 |
| Assets Under Management (AUM) | ₹3,459.68 Crores |
| Expense Ratio | 0.89% |
| Lock-in Period | None |
| Inception Date | 01 January 2013 |
| Fund Age | 12 Years |
| Benchmark | BSE Healthcare TRI |
| Scheme Type | Open Ended |
| Stamp Duty | 0.005% (effective from July 1st, 2020) |
| Exit Load | 0.50% if redeemed/switched out within 15 days from the date of allotment |
| Tax Implication | STCG: 20% if redeemed within 1 year; LTCG: 12.5% if returns exceed ₹1.25 Lakhs in a financial year |
| Stock Invested in | Sector | Value (Mn) | % of Total Holdings |
|---|---|---|---|
| Sun Pharmaceutical Industries Ltd. | Pharmaceuticals | 4,452.3 | 12.87% |
| Divis Laboratories Ltd. | Pharmaceuticals | 2,222.2 | 6.42% |
| Cipla Ltd. | Pharmaceuticals | 1,963.4 | 5.68% |
| Max Healthcare Institute Ltd. | Hospital | 1,959.5 | 5.66% |
| Lupin Ltd. | Pharmaceuticals | 1,640.6 | 4.74% |
| Lonza Group AG | Foreign Equity | 1,517.9 | 4.39% |
| Poly Medicure Ltd. | Medical Equipment & Supplies | 1,391.3 | 4.02% |
| Krishna Institute of Medical Sciences Ltd. | Hospital | 1,297.0 | 3.75% |
| Jupiter Life Line Hospitals Ltd. | Hospital | 1,259.8 | 3.64% |
| Aether Industries Ltd. | Specialty Chemicals | 1,151.7 | 3.33% |
Conclusion
Pharma-based mutual funds can be significant for both diversification and growth, especially for investors seeking exposure to essential, long-term projects. Strong 1-year returns across various fund houses illustrate the sector’s growth potential. By analyzing the TER and returns, investors can make an informed decision about which fund aligns with their financial goals and risk appetite. Here we have discussed a total of five pharma mutual funds. Do your own due diligence before investing in these pharma mutual funds.