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Healthcare Mutual Funds
Healthcare mutual funds invest mainly in companies involved in pharmaceuticals, hospitals, diagnostics, and medical devices. These funds give investors exposure to businesses that benefit from rising healthcare demand and medical innovation.
Healthcare mutual funds are often referred to as pharma or healthcare sector mutual funds, as many of the companies in this category operate in the pharmaceutical industry.
What are Healthcare Sector Mutual Funds?
Healthcare mutual funds are thematic equity schemes that invest primarily in companies operating in the healthcare and pharmaceutical industries. This includes businesses involved in drug manufacturing, hospital services, diagnostics, and medical equipment.
As per guidelines from the Securities and Exchange Board of India, sector and thematic mutual funds must invest at least 80% of their portfolio in equity and equity-related instruments aligned with the chosen sector or theme.
Because these funds focus on a single sector, their performance is closely linked to developments in the healthcare and pharmaceutical industries.
Best Healthcare Mutual Funds
Below is a list of some of the best healthcare mutual funds, including pharma-focused funds, along with their Assets Under Management (AUM) and expense ratios.
AUM Growth of Sector Healthcare Mutual Funds - March 2026
In the past one month, the ICICI Prudential Pharma Healthcare and Diagnostics (P.H.D) Fund Direct Growth has emerged as the leader in net AUM growth, witnessing an impressive addition of ₹580.7 crore. This positions it as one of the top-performing Sector Healthcare mutual funds in terms of investor interest and fund growth.
Fund | 1M Net Flow | 1M Net Flow % | |
|---|---|---|---|
 ICICI Prudential Pharma Healthcare and Diagnostics P.H.D Fund Current AUM: 6.66K Cr | +₹580.7 Cr | 8.99% | Invest |
 DSP Healthcare Fund Current AUM: 2.97K Cr | +₹8.38 Cr | 0.26% | Invest |
 WhiteOak Capital Pharma and Healthcare Fund Current AUM: 491.85 Cr | +₹7.72 Cr | 1.54% | Invest |
 Kotak Healthcare Fund Current AUM: 451.35 Cr | +₹1.72 Cr | 0.36% | Invest |
 Tata India Pharma & Healthcare Fund Current AUM: 1.24K Cr | +₹1.4 Cr | 0.10% | Invest |
Top Stock added by Sector Healthcare Mutual Funds - March 2026
Over the last month, Biocon Ltd has been added to the portfolios of 3 out of 18 Sector Healthcare mutual funds. This signals growing confidence in the stock’s long-term growth prospects among Sector Healthcare fund managers.
Top Stock sold by Sector Healthcare Mutual Funds - March 2026
In contrast, Aurobindo Pharma Ltd has been sold by 3 of 18 Sector Healthcare mutual funds in the last one month. This shift underscores a cautious approach by fund managers toward the stock, reflecting changing market dynamics.
Sector allocation of Sector Healthcare mutual funds - March 2026
Over the last 6 months, Sector Healthcare category has seen increased allocation towards Energy, Consumer Cyclical, Consumer Defensive sectors and allocation in Tech, Industrial, Financial Services sectors has decreased
Sector | AUM |
|---|---|
 Health Decreased by 3.90%, in last 6M | 30.92K Cr |
 Basic Materials Increased by 11.61%, in last 6M | 617.94 Cr |
 Financial Services Decreased by 51.39%, in last 6M | 95.75 Cr |
 Consumer Defensive Increased by 28.60%, in last 6M | 74.21 Cr |
 Energy Increased by 100.00%, in last 6M | 22.33 Cr |
 Consumer Cyclical Increased by 100.00%, in last 6M | 6.96 Cr |
 Industrial Decreased by 55.44%, in last 6M | 1.92 Cr |
 Tech Decreased by 99.65%, in last 6M | 0.08 Cr |
Frequently Asked Questions
Are healthcare funds suitable for beginners?
Given their high-risk nature, healthcare funds are generally more suitable for experienced investors who understand the sector's dynamics and risks. Beginners should approach these funds with caution and consider them as a small part of a well-diversified portfolio.
How do healthcare funds compare to broader market funds?
Healthcare funds have the potential to deliver higher returns than broader market funds during periods of strong performance in the healthcare sector. However, they are also more susceptible to sector-specific risks and can underperform the broader market at times.
How do healthcare sector funds differ from pharma funds?
Pharma funds focus only on pharmaceutical companies, while healthcare funds may include a broader range, hospitals, diagnostics, biotech, and healthcare tech firms.
What are the risks involved in healthcare mutual funds?
Healthcare sector mutual funds include risks like sector concentration risk, regulatory risk and high volatility.
How do healthcare sector funds differ from pharma funds?
Pharma funds focus only on pharmaceutical companies, while healthcare funds may include a broader range of hospitals, diagnostics, biotech, and healthcare tech firms.
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