WHICH SECTORS DID MUTUAL FUNDS PREFER IN APRIL 2025?
Which were the most preferred sectors for mutual funds in April 2025? A one month perspective gives a very short term picture. However, we will first look at sectors that attracted maximum MF funds in April 2025. In absolute terms, Banking, Oil, automobiles, telecom, and pharma were the most preferred sectors. In terms of percentage change; diamonds, agriculture, oil & gas, alcohol, and realty were the most preferred sectors.
There is another interesting perspective. Here we look at equities overall (including equity holdings in hybrid and passive funds). As of April 2025, active equity AUM stood at ₹30.58 Trillion. However, overall equity holdings of Indian MFs was much bigger at ₹42.64 Trillion. That means ₹12.06 Trillion (28.3%) of MF equity holdings was accounted for by hybrid and index funds. It is this total equity holding of ₹42.64 Trillion that we will use for our analysis.
SECTORS WHERE MF EXPOSURE WAS ABOVE ₹1 TRILLION
The overall equity AUM of all mutual funds stood at ₹42.64 Trillion in April 2025; compared to ₹41.11 Trillion in March, and ₹38.24 Trillion in February 2025. This AUM is 22.2% higher than the AUM of ₹34.89 Trillion in the year ago period.
| Sectors | April 2024 | January 2025 | March 2025 | April 2025 |
| Banking & Finance | 10,07,483 | 11,39,322 | 12,05,703 | 12,71,924 |
| IT-Services | 2,97,918 | 4,28,239 | 3,83,320 | 3,81,657 |
| Auto & Auto Ancillaries | 3,22,490 | 3,78,686 | 3,60,040 | 3,73,062 |
| Pharmaceuticals | 2,78,900 | 3,49,728 | 3,57,046 | 3,65,405 |
| Oil & Gas | 2,31,643 | 2,38,635 | 2,44,668 | 2,64,437 |
| FMCG | 1,72,989 | 2,12,598 | 2,06,629 | 2,13,290 |
| Telecom | 1,01,746 | 1,29,485 | 1,33,072 | 1,41,765 |
| Capital Goods | 1,33,141 | 1,45,013 | 1,41,259 | 1,41,758 |
| Retail | 85,275 | 1,24,654 | 1,27,710 | 1,34,505 |
| Power | 1,14,380 | 1,20,117 | 1,27,678 | 1,30,270 |
| Metals & Mining | 1,22,799 | 1,25,174 | 1,32,945 | 1,28,787 |
| Chemicals & Fertilisers | 91,912 | 1,10,500 | 1,12,265 | 1,19,726 |
| Infrastructure | 1,14,352 | 1,26,097 | 1,21,139 | 1,17,454 |
Data Source: AMFI, MF Websites (₹ in Crore)
These top 13 sectors account for 88.7% of total equity AUM of Indian mutual funds. There is not much of a surprise in the list, with financials and IT leading the market cap rankings. If you compare with the year ago period, there are some sectors that have seen a sharp spike like Aviation, Retail, Agriculture, Telecom. Pharmaceuticals, Chemicals & Fertilizers, IT Services, and Banking. Which are the sectors to have lost value compared to January 2025? Paper, plastics, abrasives, IT Services, Media, infrastructure, and textiles have lost MF AUM value compared to the quarter-ago period.
SECTORS WITH THE BEST YOY AUM ACCRETION
Let us first focus on the size effect and look at the sectors that showed the best AUM accretion yoy in terms of absolute change in Rupee AUM.
| Sectors | April 2024 | April 2025 | AUM Change | (% Change) |
| Banking & Finance | 10,07,483 | 12,71,924 | 2,64,441 | 26.25% |
| Pharmaceuticals | 2,78,900 | 3,65,405 | 86,505 | 31.02% |
| IT-Services | 2,97,918 | 3,81,657 | 83,739 | 28.11% |
| Auto & Auto Ancillaries | 3,22,490 | 3,73,062 | 50,572 | 15.68% |
| Retail | 85,275 | 1,34,505 | 49,230 | 57.73% |
| FMCG | 1,72,989 | 2,13,290 | 40,301 | 23.30% |
| Telecom | 1,01,746 | 1,41,765 | 40,019 | 39.33% |
| Oil & Gas | 2,31,643 | 2,64,437 | 32,794 | 14.16% |
| Chemicals & Fertilisers | 91,912 | 1,19,726 | 27,814 | 30.26% |
| Power | 1,14,380 | 1,30,270 | 15,890 | 13.89% |
| Construction Materials | 77,466 | 93,289 | 15,823 | 20.43% |
| Consumer Durables | 70,193 | 85,356 | 15,163 | 21.60% |
| Aviation | 18,118 | 29,111 | 10,993 | 60.67% |
| Capital Goods | 1,33,141 | 1,41,758 | 8,617 | 6.47% |
| Alcohol | 21,905 | 29,702 | 7,797 | 35.59% |
Data Source: AMFI, MF Websites (₹ in Crore)
Here we look at the sectors that showed the best AUM accretion in rupee terms. This shows actual AUM value created, but it can be biased in favour of large sectors. Here are some quick findings. The biggest value creation was obviously in banking, but the second best AUM accretion was pharma, which is surprising as it is not among heavyweight sectors. Retail, telecom, and chemicals & fertilizers are the other 3 sectors that are not heavyweight sectors, but still have shown solid AUM growth traction. While retail was driven by digital retail stories, telecom was driven by Bharti Airtel. In the case of chemicals, it was more on the hope of revival in demand for specialty chemicals; both globally and domestically.
SECTORS WITH BEST PERCENTAGE AUM ACCRETION
The absolute change is vulnerable to the base effect. To be fair, we also look at the percentage change in AUM on a yoy basis.
| Sectors | April 2024 | April 2025 | AUM Change | (% Change) |
| Aviation | 18,118 | 29,111 | 10,993 | 60.67% |
| Retail | 85,275 | 1,34,505 | 49,230 | 57.73% |
| Agri | 12,332 | 18,124 | 5,792 | 46.97% |
| Telecom | 1,01,746 | 1,41,765 | 40,019 | 39.33% |
| Alcohol | 21,905 | 29,702 | 7,797 | 35.59% |
| Pharmaceuticals | 2,78,900 | 3,65,405 | 86,505 | 31.02% |
| Diversified | 14,653 | 19,091 | 4,438 | 30.29% |
| Chemicals & Fertilisers | 91,912 | 1,19,726 | 27,814 | 30.26% |
| IT-Services | 2,97,918 | 3,81,657 | 83,739 | 28.11% |
| Banking & Finance | 10,07,483 | 12,71,924 | 2,64,441 | 26.25% |
| FMCG | 1,72,989 | 2,13,290 | 40,301 | 23.30% |
| Others | 26,997 | 33,273 | 6,276 | 23.25% |
| Diamond & Jewellery | 21,694 | 26,621 | 4,927 | 22.71% |
| Consumer Durables | 70,193 | 85,356 | 15,163 | 21.60% |
| Textiles | 23,383 | 28,366 | 4,983 | 21.31% |
Data Source: AMFI, MF Websites (₹ in Crore)
This list has throw up some interesting names. Aviation is right there at the top, thanks to the relentless rally in Indigo Airways as it has consolidated its market share. Retail is one sector that has shown traction in absolute and in relative terms. Telecom, Pharma, and chemicals & fertilizers again find themselves in the percentage accretion list also.
Despite the correction post December 2024, the recovery in late March and April has been sharp. The market has absorbed the shocks of tariff uncertainty and the brief Indo-Pak war and has come out stronger. While banking continues to lead by sheer size, the real growth traction is in sectors like pharmaceuticals, chemicals, telecom, and the convergence of digital and retail. These could be the sectors to watch out for.