The strength visible in the midcap stocks has helped several mutual funds from the segment deliver solid returns for their investors at a time when the mainboard indices are languishing due to the West Asia crisis, which has driven crude oil prices higher, pressured the Indian rupee and spurred foreign investor outflows.
Despite an unfavourable macro setup, the Nifty Midcap 150 index had risen to its 52-week high late last month. So far, this year the index is up 3.61%. The interest in the midcap stocks remains strong, as evident from record inflows into the segment by mutual fund investors in April.
Data from Association of Mutual Funds of India (AMFI) shows that investors poured ₹6,551.40 crore in the mid-cap funds, up 8% on a monthly basis. Large-cap funds, by contrast, lost some shine, with inflows dropping 15.3% to ₹2525 crore as investors scoured for opportunities beyond India’s blue-chip firms.
Midcap funds: Top gainers YTD
Several mutual funds from the midcap space have, therefore, delivered up to 10% returns so far this year, shows data from ACE Mutual Fund. Here are the details:
1. HSBC Midcap Fund | YTD gain: 9.65%
The HSBC Midcap Fund has emerged as the leading midcap fund so far in 2026, with a 9,65% increase. It has a net asset value (NAV) of ₹441.35 and assets under management (AUM) of ₹13,400 crore. However, the expense ratio of the fund is high at 3.6%. HSBC Midcap Fund’s top holdings include BSE, Groww, Federal Bank, Hitachi Energy and Nykaa.
The fund has delivered solid gains, rising 18% in a year, 104% in three years and 410% in ten years.
2. ICICI Pru Midcap Fund | YTD gain: 5.4%
The ICICI Pru Midcap Fund follows in the second spot with a return of 5.4%. The fund has an NAV of ₹332.28 and an AUM of ₹7,500 crore. Its expense ratio is significantly lower than HSBC Midcap Fund at 1.53%. The fund has also delivered competitive returns on a longer time frame. It is up 14% in the last one year, 96% in three years and 401% in 10 years.
3. JM Midcap Fund | YTD gain: 4.6%
The JM Midcap Fund has delivered a YTD gain of 4.61% to its investors. This fund is a more recent launch with only data of the last three years available, during which it has added 6% in a year, 17% in two years and 82% in three years.
Its expense ratio remains high at 2.31% while its AUM is small at ₹1160 crore. The NAV of JM Financial Midcap Fund is ₹19.87.
4. Quant Midcap Fund | YTD gain: 4.3%
The Quant Midcap Fund, fourth on the list, has given a return of 4.3% to its investors. This fund has an AUM of ₹7,900 crore and an expense ratio of 1.8%. The NAV for the fund stood at ₹218.06.
Despite encouraging YTD performance, Quant MF’s Midcap fund has struggled in the last couple of years, with negative returns during that period. Meanwhile, on a three-year basis, it has risen 60% and over 10 years 375%.
5. Mahindra Manulife Midcap Fund | YTD gain: 4.1%
Having an AUM of ₹4600 crore, Mahindra Manulife Midcap Fund has delivered its investors a return of 4.1% to emerge as the fifth-best performing fund from the midcap category.
The fund house has an expense ratio of 1.61% and its NAV is ₹35.21. The fund has been delivering consistently positive gains with an 8% rise in a year, 84% in three years and 272% in seven years.
Midcap outlook
According to analysts, along with better net inflows, other reasons for midcap performance include stronger-than-expected corporate results for Q4FY26, technical recovery from oversold territory, and lower valuations.
Vinod Nair, Head of Research at Geojit Investments Limited, said that the one-year forward price-to-earnings ratio for midcaps has fallen below the five-year average of 26x, encouraging the ongoing upside. “However, the recent rally has again elevated India’s midcap valuations relative to large caps, with the premium exceeding 50%. The renewed optimism is expected to persist in the short term due to these underlying tailwinds,” he said, adding that for this momentum to be sustained, two key developments are necessary: a reversal in FIIs’ sell strategy in India and a reduction in earnings setbacks estimated for H1FY27.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
