In mutual fund investing, one good year isn’t enough and what matters more is consistency. And that’s where a few Motilal Oswal funds stand out, delivering strong returns.
Three funds in particular — Motilal Oswal Midcap Fund – Direct Plan – Growth, Motilal Oswal Large and Midcap Fund – Direct Plan – Growth, and Motilal Oswal ELSS Tax Saver Fund – Direct Plan – Growth — have managed to deliver strong returns over both three and five years. In fact, these same three funds dominate the rankings in both periods, which says a lot about consistency.
Looking at five-year performance first, Motilal Oswal Midcap Fund leads the pack with a return of 24.76%, followed by its large & midcap fund at 22.25%, and the ELSS fund at 20.12%. Over three years too, these equity funds continue to feature at the top, with returns ranging between 22% and 26%, although the order changes slightly.
To put this into perspective, if you had invested Rs 1 lakh five years ago, your investment would have grown to roughly:
Rs 3.02 lakh in Motilal Oswal Midcap Fund
Rs 2.73 lakh in Motilal Oswal Large & Midcap Fund
Rs 2.50 lakh in Motilal Oswal ELSS Tax Saver Fund
That’s the power of compounding when strong returns sustain over time.
Midcap fund: High returns, but with higher swings
Motilal Oswal Midcap Fund (Direct)
Among the three, the Motilal Oswal Midcap Fund clearly stands out for its five-year performance. Midcap stocks are often seen as high-growth opportunities, and this fund seems to have captured that well.
Since its launch in 2014, the fund has delivered over 21% returns, which reflects its ability to ride different market cycles. It also has a fairly large asset base of over Rs 31,000 crore.
But as expected with midcaps, the ride hasn’t been smooth. The fund shows higher volatility compared to its benchmark and category peers. Its risk-adjusted ratios are also slightly lower, which essentially means investors have taken on more risk to earn those returns.
On the portfolio side, the fund is heavily tilted towards financials and technology, which together make up more than half of its holdings. Stocks like Kalyan Jewellers, One97 Communications, Persistent Systems, Eternal, and Coforge feature among its top bets.
Large & midcap fund: Strong balance with standout alpha
Motilal Oswal Large & Midcap Fund (Direct)
The Motilal Oswal Large & Midcap Fund offers a different kind of story. Instead of pure midcap aggression, it blends large caps with midcaps—giving it a mix of stability and growth.
Despite being relatively young (launched in 2019), the fund has delivered around 22% returns since inception, which is quite impressive. More importantly, it has consistently outperformed both its benchmark and category peers.
What really stands out here is its alpha generation. With an alpha of over 8, the fund has managed to deliver returns well above what the market would typically offer. Its Sharpe and Sortino ratios are also stronger, suggesting that returns have been relatively efficient compared to the risk taken.
That said, it is still a high-risk fund. Its volatility is higher than average, and with a beta above 1, it tends to react more sharply to market movements.
Sector-wise, the fund is fairly diversified, with exposure spread across financials, industrials, and consumption-driven sectors. Its top holdings include Eternal, Muthoot Finance, MCX, CG Power, and Waaree Energies.
ELSS fund: Tax saving plus performance
Motilal Oswal ELSS Tax Saver Fund (Direct)
For investors looking to save tax while staying invested in equities, the Motilal Oswal ELSS Tax Saver Fund has delivered a strong proposition.
ELSS funds come with a three-year lock-in, but in return, they offer tax benefits under Section 80C along with potential for equity-driven growth. This fund has done well on both fronts.
Since its launch in 2015, it has delivered over 17% returns, and more importantly, it has remained among the top performers in the ELSS category—especially over the last three years.
Like the other two funds, this one too carries a very high risk tag. Its volatility is elevated, but it compensates for that with better risk-adjusted returns. Its alpha remains strong, indicating that the fund manager’s stock selection has added meaningful value.
The portfolio is tilted towards financials, followed by industrials and consumption themes. Key holdings include MCX, Piramal Finance, Jain Resource Recycling, Apar Industries, and Waaree Energies.
So, what does this mean for investors?
One clear takeaway is consistency. It’s not very common to see the same funds topping charts across multiple time frames, but these three have managed to do that.
At the same time, all three funds fall under the ‘Very High Risk’ category. That means they may not be suitable for conservative investors or those with short-term goals. These are funds that are better suited for investors who can stay invested through market ups and downs.
Another point worth noting is the role of active management. Strong alpha across these funds suggests that stock selection—not just market movement—has contributed significantly to returns.
Disclaimer:
The returns mentioned above are based on historical performance and are for informational purposes only. Mutual fund investments are subject to market risks, and past performance does not guarantee future returns. Investors should assess their financial goals, risk appetite, and consult a financial advisor before making any investment decisions.