One of the largest mutual fund houses in the country, HDFC Mutual Fund has earned the trust of investors over the years. Be it conservative investors or risk-taking young investors – HDFC MF’s schemes have proven to be suitable for different profiles. Over the last three years, some of its equity funds have performed exceptionally well, yielding a CAGR of between 20% and 27%.
In this write-up, we will review the 5 top-rated equity funds (direct plan) of HDFC Mutual Fund, which are rated 5-star by Value Research. These funds are reviewed based on their returns, features and fees.
Top 5 HDFC mutual fund schemes with highest ratings and 3-year returns
1. HDFC Mid Cap Fund
Launched in January 2013, this fund has delivered a strong return of 21.06% since inception. With assets under management (AUM) of over Rs 84,000 crore as of June 2025 and a relatively low expense ratio of 0.74%, it tracks the NIFTY Midcap 150 TRI and carries a very high risk rating. This mid-cap fund is suitable for investors with a high risk appetite and a long-term investment horizon.
3-year return of the fund on lump sum investment
Over the last three years, HDFC Mid Cap Fund has delivered an impressive CAGR of 26.89%. The fund has outperformed its benchmark BSE 150 MidCap TRI, which gave a 22.93% return during the same period. It has also stayed ahead of the average returns in the mid-cap category.
With this rate of return, a lump sum investment of Rs 1 lakh in this fund would be worth now Rs 2.04 lakh after three years. The fund has managed to generate an absolute return of 104.60% in 3 years.
3-year SIP return
The fund has generated an SIP return of 22.94% CAGR over the last three years, turning Rs 10,000 monthly investment into Rs 5 lakh.
2. HDFC Focused Fund
Launched in September 2004, this fund has generated a return of 16.10% since inception. As of June 2025, it manages assets worth over Rs 20,800 crore and has an expense ratio of 1.64%. The fund is benchmarked against the NIFTY 500 TRI and is rated as “very high” on the riskometer. The fund is more suited for aggressive investors seeking focused equity exposure.
3-year return of the fund on lump sum investment
Over the past three years, HDFC Focused Fund has delivered a strong annualised return of 24.32%, comfortably beating both its benchmark BSE 500 TRI, which returned 15.83%, and the average flexi-cap category return of 16.07%.
A lump sum investment of Rs 1 lakh in this fund made three years back would have grown to Rs 1.92 lakh now, earning a CAGR of 24.32%. The fund’s absolute return in 3 years stood at 92.37%.
3-year SIP return
An SIP of Rs 10,000 in this fund started three years ago would be worth now Rs 4.95 lakh, generating a CAGR of 37.64%.
3. HDFC Flexi Cap Fund
Launched in January 2013, this fund has delivered a return of 16.96% since inception. As of June 2025, it manages a sizeable corpus of Rs 79,585 crore with a low expense ratio of 0.72%. Benchmarked against the NIFTY 500 TRI and carrying a “very high” risk rating, the fund is designed for investors looking for long-term capital growth through a diversified equity portfolio.
3-year return of the fund on lump sum investment
HDFC Flexi Cap Fund has delivered a solid 23.42% annualised return over the past three years. The fund has outperformed its benchmark BSE 500 TRI, which gave a 15.83% CAGR during the same period. The fund has also beaten the broader flexi-cap category, reflecting strong portfolio management and consistent performance across market cycles.
With this rate of return, a lump sum investment of Rs 1 lakh in this fund made 3 years ago would be worth now Rs 1.88 lakh. As regards the absolute returns over this period, the flexi-cap fund has given an 88.20% yield.
3-year SIP return
The fund’s SIP returns have also been quite impressive at 36.6% in the last three years. A monthly investment of Rs 10,000 in this scheme would have grown to Rs 4.91 lakh now after three years.
4. HDFC ELSS Tax Saver Fund
Launched in March 1996, this fund has delivered an impressive return of 23.18% since inception. With assets of Rs 16,908 crore as of June 2025 and an expense ratio of 1.70%, it is benchmarked against the NIFTY 500 TRI. Carrying a “very high” risk rating, the fund aims to offer tax benefits under Section 80C while generating long-term wealth for disciplined investors.
3-year return of the fund on lump sum investment
Over the past three years, HDFC ELSS Tax Saver Fund has delivered a robust annualised return of 22.82%. The fund has outperformed its benchmark BSE 500 TRI, which returned 15.83% in the same period. It has also stayed ahead of the average performance in the ELSS category.
A lump sum investment of Rs 1 lakh in this fund would have turned into Rs 1.85 lakh if someone had made this investment three years ago. The fund’s three-year absolute return has been 85.49%.
3-year SIP return
The fund has given an SIP return of 35.47% CAGR over the last three years, turning a Rs 10,000 monthly investment into Rs 4.87 lakh.
5. HDFC Retirement Savings Fund Equity Plan
Launched in February 2016, this fund has delivered a healthy return of 20.06% since inception. With assets under management of Rs 6,701 crore as of June 2025 and a low expense ratio of 0.74%, it is benchmarked against the NIFTY 500 TRI. The fund has received a “very high” risk rating from Value Research. The fund is designed to help investors build a retirement corpus through long-term equity investments.
3-year return of the fund on lump sum investment
HDFC Retirement Savings Fund Equity Plan has delivered an impressive 20.23% annualised return over the past three years. It has outperformed its benchmark BSE 500 TRI, which returned 15.83% during the same period. The fund has also outperformed the broader category average, making it a strong choice for investors focused on long-term retirement planning through equity investments.
The fund would have turned a Rs 1 lakh invested as lump sum three years ago into Rs 1.73 lakh. The absolute return of the fund in this period stood at 73.95%.
3-year SIP return
A Rs 10,000 SIP started in this scheme three years ago would be worth now Rs 4.60 lakh, earning a CAGR of 22.79%.
(Source: Value Research)
What to pay attention to apart from rating and returns in mutual funds
Although the returns of the last 3 years can indicate the performance of a fund, it is not a right strategy to base only the returns while selecting a mutual fund. To measure the quality of any fund, we should also look at the rating, experience of the fund manager, portfolio stability, expense ratio, and risk-reward profile of the fund.
A 5-star rating means that the fund has performed well in its category, but it is not necessary that the same pace will continue in the future. Therefore, while investing from a long-term perspective, all these parameters should be thoroughly examined.
Caution is important in selecting a fund
Investing solely based on past returns is a common mistake that many new investors often make. It is important to understand your financial goals and look at the volatility of the fund before investing. Also, every investor has a different risk profile — so it would be wise to consult a SEBI-registered mutual fund distributor or financial advisor before investing.
Disclaimer: The above content is for informational purposes only. Mutual Fund investments are subject to market risks. Please consult your financial advisor before investing.