List of the Top Technology Mutual Funds 2026
India’s IT industry is projected to reach $350 bn in FY26, up from $283 bn in FY25. Technology spending in India is expected to reach $54.5 bn by 2027, the highest in the Asia Pacific region. The AI industry alone is projected to reach $28.8 bn by 2025, growing at a 45% CAGR.
Technology mutual funds aim to capture growth from digital transformation, rising R&D investments, semiconductor expansion, startup innovation, and increasing global demand for Indian technology services. Let’s look at the top technology mutual funds in India based on 5Y CAGR, along with benefits, risks, and factors to consider before investing.
Overview of Top Technology Mutual Funds
Here is a list of the best technology and IT sector mutual funds in India based on 5Y CAGR
| Name | CAGR 5Y (%) | AUM (in cr.) | CAGR 3Y (%) | Expense Ratio(%) | Alpha(%) | NAV (in ₹ per unit) | Volatility(%) | Exit Load(%) |
|---|---|---|---|---|---|---|---|---|
| SBI Technology Opp Fund | 15.3 | 5,055.86 | 11.68 | 0.9 | 11.47 | 225.18 | 14.47 | 0.5 |
| Tata Digital India Fund | 13 | 11,998.88 | 9.51 | 0.51 | 26.49 | 48.59 | 18.54 | 0.25 |
| ICICI Pru Technology Fund | 12.76 | 15,439.46 | 9.67 | 0.99 | 13.97 | 199.63 | 16.97 | 1 |
| Franklin India Technology Fund | 12.36 | 1,937.75 | 17.29 | 1.06 | 11.89 | 516.21 | 14.52 | 1 |
| Aditya Birla SL Digital India Fund | 11.85 | 4,836.82 | 8.51 | 0.8 | 13.18 | 170.98 | 17.51 | 1 |
Disclaimer: Please note that the above list of technology mutual funds is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing. The data is derived from Tickertape Mutual Fund Screener and is subject to real-time updates.
Note: The data on the list of infra mutual funds is from 24th February 2026. This data is derived from the Tickertape Mutual Funds Screener.
- Plan: Growth
- Category: Sectoral Fund – Technology
- 5Y CAGR: Sorted from highest to lowest
Pro Tip: You can use Tickertape’s Mutual Fund Screener to research and evaluate funds with over 50+ pre-loaded filters and parameters.
What are Technology Mutual Funds?
Technology mutual funds are sectoral equity mutual funds that invest primarily in companies operating in the technology sector. These funds focus on businesses involved in areas such as IT services, software development, cloud computing, artificial intelligence, semiconductors, telecom technology, electronics manufacturing, and digital platforms. Unlike diversified equity funds that spread investments across multiple sectors, technology mutual funds concentrate their holdings within the technology industry.
Overview of Top Technology Mutual Funds
SBI Technology Opportunities Fund
SBI Technology Opportunities Fund invests mainly in Indian technology and technology-related companies. The fund focuses on IT services, software companies, digital businesses, and firms that benefit from technological adoption and innovation. It aims to capture long-term growth driven by digital transformation and increasing demand for technology services.
Tata Digital India Fund
Tata Digital India Fund invests in companies that benefit from digital adoption and internet-based business models. The fund allocates to IT services companies, digital platforms, and technology infrastructure providers. It focuses on businesses that gain from India’s growing digital economy and rising use of online services.
ICICI Prudential Technology Fund
ICICI Prudential Technology Fund is a sectoral equity fund that invests in technology and technology-linked companies. The portfolio includes software companies, IT service providers, and businesses offering digital solutions. The fund seeks to participate in growth driven by innovation, automation, and global technology spending.
Franklin India Technology Fund
Franklin India Technology Fund invests primarily in companies operating in the technology sector. It includes exposure to IT services, software development, communication technology, and related businesses. The fund aims to benefit from innovation-led growth and increasing global demand for digital services.
Aditya Birla Sun Life Digital India Fund
Aditya Birla Sun Life Digital India Fund invests in companies that operate in or benefit from the digital ecosystem. The portfolio covers technology firms, digital service providers, and technology-enabled businesses. The fund focuses on capturing long-term opportunities arising from digital consumption, automation, and innovation trends in India.
Taxation of Technology Mutual Funds
Technology mutual funds are classified as equity mutual funds for taxation purposes because they invest predominantly in equity and equity-related securities.
| Capital Gains Type | Holding Period | Tax Rate |
| Short-Term Capital Gains (STCG) | Less than 12 months | 20% |
| Long-Term Capital Gains (LTCG) | More than 12 months | 12.50% |
How to Invest in the Technology Mutual Funds?
You can easily start to invest in the best Technology mutual funds by following these steps:
- To invest in the Technology mutual funds, you can visit an equity investment platform such as smallcase
- The next step is to research and identify the best technology fund that matches your investment thesis. Tools like the Tickertape Mutual Fund Screener can help you filter and compare funds based on parameters such as returns, expense ratio, and fund size.
- Once you shortlist the funds, visit smallcase, log in, and search for the fund by name. You can then choose the investment mode, either a one-time lump sum or a SIP plan, and complete the process.
Who Should Consider Technology Mutual Funds?
- Investors Seeking Sector-Focused Exposure: Technology mutual funds suit investors who want direct exposure to the technology sector instead of spreading investments across many industries. These funds invest mainly in IT services, software, digital platforms, semiconductors, and other technology-driven businesses.
- Investors With A Long-Term Investment Horizon: The technology sector grows through innovation, product development, and digital adoption over time. Investors with a longer investment horizon can better navigate periods of short-term fluctuations linked to market cycles and global trends.
- Investors Interested In Digital And Innovation Themes: Technology mutual funds provide exposure to companies benefiting from artificial intelligence, cloud computing, automation, semiconductors, and digital transformation. Investors who want participation in these themes can access them through a single fund.
- Investors Evaluating Portfolio Allocation By Sector: Technology mutual funds can form part of a broader equity portfolio. Their allocation affects overall sector exposure and diversification balance within the portfolio structure.
Benefits of Investing in Technology Mutual Funds
- Strong Growth in the IT Sector: India’s IT industry is projected to reach $350 bn in FY26, up from $283 bn in FY25. IT contributes around 7% to India’s GDP and 12% to total services GVA. As listed technology companies expand revenues and global contracts, mutual funds holding these stocks may reflect that earnings growth in the overall portfolio performance.
- Expansion of Artificial Intelligence: India’s AI industry is projected to reach $28.8 bn by 2025, growing at a 45% CAGR. Between 2010 and 2025, India filed over 86,000 AI patents, with strong growth in recent years. Technology mutual funds gain exposure to companies developing AI, automation, machine learning, and analytics solutions, which can support long-term revenue growth within fund portfolios.
- Rapid Growth In Engineering R&D: India’s engineering R&D and product development market is expected to reach $63 bn by 2025, growing at a 12% CAGR. As multinational companies increase R&D outsourcing to India, listed technology firms may benefit, which in turn supports mutual funds invested in these companies.
- Rising Semiconductor and Electronics Investments: India is witnessing large investments in semiconductor manufacturing and electronics production across states such as Gujarat, Assam, and Karnataka. Semiconductor expansion strengthens domestic chip design, electronics manufacturing, and hardware capabilities. Technology mutual funds investing in semiconductor and electronics companies gain exposure to this structural expansion.
- Policy Support For Innovation: The government cleared a ₹99,771 cr. Research, Development and Innovation scheme to boost deep-tech research. The India AI Mission received ₹2,000 cr. allocation in 2025–26. This policy support can improve long-term growth prospects for companies held within technology funds.
Risks of Investing in Technology Mutual Funds
- Sector Concentration Risk: Technology funds invest primarily in technology-related companies. If the technology sector underperforms, the fund may experience sharper declines compared to diversified equity funds. Limited exposure to other sectors reduces diversification benefits.
- Global Demand Dependency: A large portion of revenue for Indian technology companies comes from overseas markets, especially the US and Europe. Slowdowns in global IT spending, reduced corporate tech budgets, or recessionary conditions can affect company earnings and mutual fund performance.
- Currency Risk: Many Indian IT companies earn revenue in foreign currencies. Movements in exchange rates, especially the US dollar against the rupee, can impact earnings. Currency fluctuations can therefore influence mutual fund returns.
- Rapid Technological Change: The technology sector evolves quickly. Companies that fail to adapt to new technologies such as AI, cloud, cybersecurity, or semiconductor advancements may lose competitiveness. This risk can affect portfolio holdings within technology mutual funds.
- Regulatory and Data Policy Risk: Changes in global data protection laws, digital regulations, export controls, or technology policies can impact business operations. Compliance costs and policy shifts may influence profitability in certain segments.
Factors to Consider Before Investing In Technology Mutual Funds
- Sector Concentration: Technology mutual funds allocate a large portion of their assets to technology-related companies. Because of this focused exposure, fund performance remains closely linked to trends within the technology sector rather than the broader market.
- Dependence on Global Revenue: Many companies held within technology mutual funds generate significant revenue from international markets. As a result, global IT spending, overseas economic conditions, and corporate technology budgets can influence fund returns.
- Valuation Sensitivity: Technology stocks often trade at premium valuations during growth cycles. When growth expectations moderate or earnings fall short, stock prices can adjust quickly, affecting the fund’s net asset value.
- Currency Exposure: Several portfolio companies earn revenue in foreign currencies. Exchange rate movements can impact reported earnings, which may influence overall fund performance.
- Innovation Cycle Risk: Technology mutual funds invest in companies operating in fast-evolving segments such as artificial intelligence, cloud computing, semiconductors, and digital platforms. Changes in technology trends can alter competitive dynamics and earnings potential within the portfolio.
- Cost Structure: Technology funds charge an expense ratio to manage the portfolio, cover administrative costs, and pay fund management fees. Expense ratios can vary between direct and regular plans and across fund houses. Since these costs are deducted from the fund’s assets, higher expense ratios can reduce net returns over time.
Conclusion
Technology mutual funds provide focused exposure to companies operating in India’s expanding digital and innovation-driven economy. At the same time, these funds remain sector-concentrated and sensitive to global demand, valuation trends, currency movements, and innovation cycles.
Before allocating capital, reviewing portfolio composition, global exposure, valuation levels, and cost structure helps in understanding the fund’s positioning. To analyse technology mutual funds in detail, investors can use the Tickertape Mutual Fund Screener with 50+ filters. The screener allows comparison of returns, risk metrics, expense ratios, portfolio allocation, and consistency using pre-built filters for structured evaluation.
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Frequently Asked Questions on Technology Mutual Funds
Technology mutual funds are sectoral equity funds that invest mainly in companies operating in the technology sector. These include IT services, software, digital platforms, semiconductors, telecom technology, and related businesses.
As of 24th February 2026, based on 5Y CAGR, some of the best technology funds include:
– SBI Technology Opp Fund
– Tata Digital India Fund
– ICICI Pru Technology Fund
– Franklin India Technology Fund
– Aditya Birla SL Digital India Fund
Disclaimer: Please note that the above list of best IT mutual funds is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.
Technology funds invest primarily in listed technology and technology-enabled companies. Portfolios usually include IT service providers, software exporters, digital businesses, semiconductor companies, and firms involved in emerging technologies.
Technology mutual funds are sector-focused. Since they invest in a single sector, they can experience higher volatility compared to diversified equity funds. Performance depends on technology spending trends, innovation cycles, global demand, and valuation levels.
Returns depend on sector growth, company earnings, global IT demand, and market conditions. During strong technology cycles, performance may be higher, while periods of slowdown or valuation corrections may affect returns.
Disclaimer: Please note that the above information is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing.
Technology funds are treated as equity mutual funds for taxation. Short-term capital gains (holding period less than 12 months) are taxed at 20%. Long-term capital gains (holding period more than 12 months) above ₹1.25 lakh in a financial year are taxed at 12.5% without indexation benefit.
Technology funds provide exposure to companies operating in IT services, digital platforms, semiconductors, artificial intelligence, and related areas. Their suitability depends on individual risk tolerance, investment horizon, and overall portfolio allocation. These funds are sector-focused and may experience higher volatility based on global IT spending, valuation trends, and economic conditions.
Disclaimer: Please note this information is for educational purposes only and is not recommendatory. Please conduct your own research or consult your financial advisor before investing.
Investors can conduct detailed research using tools such as the Tickertape Mutual Fund Screener to evaluate funds based on risk metrics, expense ratio, portfolio concentration, global exposure, and historical performance. Consulting a financial advisor may also help align decisions with financial goals.
Disclaimer: Please note this information is for educational purposes only and is not recommendatory.
These funds offer focused exposure to the digital economy, innovation-led growth, and technology-driven businesses. They provide professional portfolio management and access to multiple technology companies within a single scheme. They also operate under mutual fund regulatory guidelines and disclose portfolio holdings regularly.
Disclaimer: Please note this information is for educational purposes only and is not recommendatory.
Technology-focused funds carry sector concentration risk, valuation risk, global demand dependency, and sensitivity to currency movements. Their performance may fluctuate based on earnings cycles, innovation trends, and broader economic conditions.
You can start investing in technology mutual funds through smallcase by following these steps:
– Research and compare funds based on returns, expense ratio, portfolio composition, and fund size.
– Tools like the Tickertape Mutual Fund Screener help filter and evaluate funds using multiple parameters.
– After shortlisting a fund, log in to the platform, search for the fund, and choose the investment mode, either lump sum or SIP, to complete the process.
Disclaimer: Please note this information is for educational purposes only and is not recommendatory.
