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Value mutual funds are equity mutual fund schemes that invest in stocks considered undervalued compared with their intrinsic worth.
Some top performers in the category are Mahindra Manulife Value Fund (16.39%), DSP Value Fund (15.66%), LIC MF Value Fund (15.29%) and Quant Value Fund (14.53%).
Value mutual funds are equity mutual fund schemes that invest in stocks considered undervalued compared with their intrinsic worth. These funds aim to buy quality companies at reasonable prices and benefit when the market eventually recognises their true value.
Unlike momentum or growth investing, value investing focuses on businesses that may be temporarily out of favour due to market sentiment, sector weakness, or short-term concerns, even though their fundamentals remain sound.
How Do Value Mutual Funds Work?
A value fund manager typically looks for companies with low valuation ratios such as price-to-earnings (P/E) or price-to-book (P/B), strong balance sheets and healthy cash flows, consistent earnings potential, temporary mispricing by the market, and businesses with long-term recovery or re-rating potential.
The idea is simple: Buy good businesses cheap and wait patiently.
When sentiment improves or earnings strengthen, these stocks may rise sharply, helping investors generate returns over time.
Why Value Funds Gain Attention During Volatile Markets
Value funds often attract investors during uncertain phases because they generally focus on companies with stronger fundamentals and lower valuations. They include periods of geopolitical tensions, rising inflation, high market volatility, and expensive broader markets.
This makes value funds a preferred category for those seeking a balance between growth potential and risk control.
Top Value Mutual Funds Based on Recent 1-Year Returns
According to ICRA Analytics (citing data till April 15, 2026), some top performers in the category are Mahindra Manulife Value Fund (16.39%), DSP Value Fund (15.66%), LIC MF Value Fund (15.29%) and Quant Value Fund (14.53%).
The category average stood at 9.35%, outperforming several broader market benchmarks in the same period.
| Scheme Name | 6 Months | 9 Months | 1 Year (CAGR) |
|---|---|---|---|
| Mahindra Manulife Value Fund | 5.25 | 3.98 | 16.39 |
| DSP Value Fund | 2.24 | 5.47 | 15.66 |
| LIC MF Value Fund | 5.34 | 3.64 | 15.29 |
| Quant Value Fund | 2.94 | 1.98 | 14.53 |
| Category Average | -0.71 | -1.31 | 9.35 |
| Indices | |||
| BSE 500 TRI | -3.26 | -3.23 | 6.85 |
| Nifty 500 TRI | -3.08 | -3.09 | 7.20 |
* Less than 1 year Absolute, Greater than or Equal to 1 year Compound Annualized returns
Source:- ICRA Analytics Limited.
Date As of 15th April 2026
Meanwhile, the Mahindra Manulife Value Fund has completed one year since its launch. Its first year coincided with an unusually challenging macro environment. Global markets witnessed sharp swings amid escalating geopolitical tensions in West Asia involving the US and Iran, which triggered volatility across crude oil prices, currency markets, and global equities. These developments, combined with tighter global financial conditions and intermittent risk aversion, weighed on equity market sentiment through large parts of the year.
Indian equity markets were not immune. Broader indices remained volatile, with investors gravitating towards fundamentally strong, reasonably valued businesses as a defensive response to global uncertainty. Against this backdrop, value-oriented investment strategies gained prominence for their margin of safety approach and focus on earnings sustainability.
The 6-month performance, delivered amid peak geopolitical uncertainty and volatile global cues, underlines the fund’s resilience during market drawdowns, while the one year outcome reflects successful participation in recovery phases as valuation gaps narrowed.
Who Should Invest in Value Funds?
Value mutual funds may suit investors who have a long-term horizon of 5 years or more, can remain patient during slow phases, want diversified equity exposure, and prefer disciplined investing over chasing hot sectors.
Disclaimer:Disclaimer: The views and investment tips shared in this article are for general information purposes only. Readers are advised to consult a certified financial advisor before making any investment decisions.
April 19, 2026, 11:37 IST
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