Top Mutual Funds for SIP in India – List of SIP Schemes for 2025
Investors are always looking for a way to diversify their portfolios, even with limited capital. This is where SIP in mutual funds comes in. Investing in mutual funds via the Systematic Investment Plan (SIP) helps individuals select a mutual fund aligned with their preferences and benefit from the stock market’s gradual growth over time. In this blog, we will learn about SIP and how it works. We will also explore the top SIP mutual fund plans and how you can invest in them.
Top 10 Best Mutual Funds for SIP (Based on 3Y CAGR)
Here is a list of some of the best-performing mutual funds in India
| Fund Name | Sub Category | AUM (in Cr.) | CAGR 3Y (%) | Expense Ratio (%) |
|---|---|---|---|---|
| Edelweiss US Technology Equity FOF | FoFs (Overseas) | 3,222.37 | 32.71 | 1.49 |
| Bandhan Small Cap Fund | Small Cap Fund | 14,062.19 | 29.77 | 0.4 |
| Franklin India Opportunities Fund | Thematic Fund | 7,375.63 | 29.54 | 0.52 |
| SBI PSU Fund | Thematic Fund | 5,179.37 | 29.48 | 0.84 |
| Invesco India PSU Equity Fund | Thematic Fund | 1,390.50 | 29.12 | 0.9 |
| ICICI Pru Pharma Healthcare & Diagnostics (P.H.D) Fund | Sectoral Fund - Pharma & Health Care | 6,161.81 | 28.75 | 1.04 |
| Motilal Oswal Midcap Fund | Mid Cap Fund | 33,608.53 | 28.18 | 0.69 |
| Invesco India Midcap Fund | Mid Cap Fund | 7,801.80 | 28.01 | 0.55 |
| ICICI Pru Infrastructure Fund | Sectoral Fund - Infrastructure | 7,645.02 | 27.98 | 1.14 |
| Motilal Oswal Large & Midcap Fund | Large & Mid Cap Fund | 12,427.89 | 27.65 | 0.65 |
Note: The data on the list of the best mutual funds for SIP is from 8th September 2025 and is derived from Tickertape Mutual Fund Screener, using the following filters:
- Plan: Growth
- SIP Investment: Allowed
- CAGR 3Y: 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.
Top Mutual Funds for SIP: An Overview
Edelweiss US Technology Equity FOF
Edelweiss US Technology Equity Fund of Fund invests in global technology companies, primarily through an underlying US-based tech fund. It offers exposure to innovative sectors like software, cloud computing, and digital solutions.
Bandhan Small Cap Fund
Bandhan Small Cap Fund focuses on companies ranked beyond the top 250 by market capitalisation. It targets emerging businesses with growth potential across niche sectors and expanding industries within the Indian small-cap space.
Franklin India Opportunities Fund
Franklin India Opportunities Fund invests in companies positioned to benefit from structural economic shifts and evolving market trends. It identifies opportunities across market caps and sectors, aiming to capture growth themes.
SBI PSU Fund
SBI PSU Fund invests primarily in equities of public sector undertakings (PSUs) across sectors like energy, finance, and infrastructure. It seeks to benefit from PSU-driven policy initiatives and sectoral growth prospects.
Invesco India PSU Equity Fund
Invesco India PSU Equity Fund focuses on equities of public sector companies. It invests across various sectors, including banking, energy, and manufacturing, providing exposure to businesses affected by government-driven reforms.
ICICI Pru Pharma Healthcare & Diagnostics (P.H.D) Fund
ICICI Pru P.H.D Fund invests in companies across pharmaceuticals, healthcare, and diagnostics. It provides exposure to businesses benefiting from rising healthcare demand, innovation, and structural growth within the Indian medical ecosystem.
Motilal Oswal Midcap Fund
Motilal Oswal Midcap Fund invests in mid-sized companies ranked between 101 and 250 by market capitalisation. It focuses on businesses with growth potential, tapping into opportunities across diverse sectors and themes.
Invesco India Midcap Fund
Invesco India Midcap Fund targets mid-cap companies with established business models and expansion potential. It invests across industries to capture opportunities arising from India’s growing consumption and evolving economic landscape.
ICICI Pru Infrastructure Fund
ICICI Pru Infrastructure Fund invests in companies engaged in infrastructure development, including sectors like energy, construction, transportation, and utilities. It offers exposure to businesses aligned with India’s ongoing economic expansion.
Motilal Oswal Large & Midcap Fund
Motilal Oswal Large & Midcap Fund combines investments in large-cap stability and mid-cap growth. It invests across sectors to balance steady returns with opportunities from India’s evolving economic and industrial trends.
What is an SIP?
A Systematic Investment Plan (SIP) is a method of investing in mutual funds where you invest a fixed amount regularly, usually monthly or quarterly. SIPs offer a disciplined approach to investing, allowing you to benefit from rupee-cost averaging and the power of compounding over time. This makes a SIP instalment a convenient and effective way to build wealth gradually without worrying about market timing or making a significant one-time investment.
In a mutual fund scheme, a set sum is automatically deducted from your savings or a current account on a monthly basis. Then, this amount is invested in your selected mutual fund. The investment scheme corresponds to a specific number of units in the chosen mutual fund, determined by the fund’s purchase price or Net Asset Value (NAV) on the transaction date.
How to Invest in Mutual Funds for SIP?
You can easily invest in SIP mutual fund plans by following these steps:
- To invest in mutual funds, you can visit an equity investment platform such as smallcase or Tickertape.
- The next step would be to research and identify the best SIP investment plans that align with your investment thesis. You can easily select and learn more about the mutual fund SIP for higher returns with the help of a financial tool like the Tickertape Mutual Fund Screener. With 50+ pre-loaded filters, it helps you to create a comprehensive list to conduct an SIP mutual funds comparison and analysis
- Once you have selected the mutual fund SIP schemes based on different metrics and parameters, go to smallcase.com or the smallcase app, and login via your phone number. Click on ‘Discover‘ and enter the name of the specific mutual fund in the search bar and hit enter. You can click on ‘invest now’ and select whether you want to invest a lump sum amount or start a SIP and start investing!
However, if you’re confused about which stocks to pick, you can explore smallcases:
- smallcases are readymade model portfolios of stocks/ETFs, that are based on a theme idea or strategy
- They’re created and managed by SEBI-registered investment experts (also known as smallcase managers)
- smallcase offers over 500+ stock portfolios, created by 200+ managers
Here are a few popular smallcases among new investors:
Disclosures for aforementioned smallcases
Features of the Best SIP
Here are certain features of SIP funds for beginners:
- Consistent Historical Performance: Look for top SIP mutual funds with high returns and a track record of consistency over various market cycles. While past performance doesn’t guarantee future returns, it may offer insights into a fund’s resilience.
- Low Expense Ratio: A lower expense ratio indicates cost efficiency. Funds with minimal fees allow investors to retain a higher share of their returns.
- Fund Manager Expertise: The proficiency of the fund manager is crucial. An experienced and skilled manager can navigate market nuances, adapting strategies for optimal results.
- Diversified Portfolio: A well-diversified portfolio mitigates risk. Funds spreading investments across sectors and asset classes offer a balanced approach to wealth accumulation.
- Liquidity: Opt for funds with sufficient liquidity. This ensures ease of buying or selling units, especially during market fluctuations.
- Transparent Communication: A fund with transparent communication about its strategy, holdings, and plans fosters investor trust. Hence, regular updates and transparent reporting can help in decision-making.
Who Should Invest in the SIP for Mutual Funds?
- Young Earners: SIPs can appeal to individuals starting their careers, as they allow for gradual participation in the market while helping them develop a disciplined saving habit over time.
- Salaried Professionals: Regular income earners may explore SIPs as a way to align a portion of their monthly savings with potential long-term market growth.
- Long-term planners: Individuals aiming to accumulate wealth for milestones such as education, retirement, or property purchases may consider SIPs as a structured way to build a corpus over time.
- Conservative Investors: Some investors use SIPs in debt, equity, or hybrid funds to diversify across asset classes while pacing their exposure to market volatility.
Risks Involved While Investing in the SIP Mutual Funds
- Market Fluctuations: The performance of different types of SIPs is inherently linked to market movements. While historical data provides insights, economic conditions, global events, and interest rate changes can impact the returns of even the top 5 mutual funds for SIP.
- Liquidity Risk: Despite being designed for liquidity, unforeseen circumstances can impact redemption processes for SIPs. Although the Mutual Fund scheme for SIP instalments typically allows for easy exit, extreme market conditions or fund-specific issues may temporarily affect liquidity.
- NAV Volatility: Net Asset Value (NAV) represents the per-unit market value of a mutual fund on a specific date. NAV fluctuations can impact the overall returns of even the bbest SIP funds 2025. Investors should consider how market-related risks influence the NAV of the SIPs they choose.
- Fund-specific Risks: Every investment, including a good mutual fund for SIP, carries certain risks. These may include concentration risks, overexposure to specific sectors, or changes in fund management. A detailed review of the fund’s offer document can help investors better understand these risks.
Benefits of Investing in SIP Mutual Funds
- SIP Top-Up: Instead of applying for a new SIP each year, you can opt for the SIP top-up option. This allows you to set a percentage or amount increase in your investment scheme annually. By doing so, you can achieve financial goals faster and effectively combat inflation. For those exploring the best SIP plans in India, the top-up option adds flexibility and ensures you stay ahead of inflation.
- Market Timing Irrelevant: The best SIP to invest, whether for 1 year, 3 years, or longer, eliminates the need to time the market during bullish or bearish phases. By investing over multiple years, you spread the risk and average out the cost per unit, leading to enhanced returns. This is especially true for monthly SIP mutual funds, which are designed to perform steadily despite market volatility.
- Financial Discipline: True to its name, investing in SIP fosters financial discipline. Automated monthly debits from your bank account alleviate investor concerns, ensuring a systematic and stress-free approach. This feature makes India’s best SIP plan for investment an ideal choice for those seeking consistency in their financial planning.
- Power of Compounding: According to the concept of compound interest, even small investments over a long period can yield substantial returns. This is why the best SIP for long term investments is so effective in building a significant corpus. The power of compounding is key for those considering SIP investment options India.
- Minimal Initial Investment: Different types of SIPs empower investors to start with as little as ₹100 per month. This makes top SIP plans accessible to all kinds of investors, including those looking for the best mutual fund to explore now or the best SIP plan for 3 years.
Taxation on Mutual Funds for SIP
The taxation on capital gains from your mutual fund investments is based on their holding periods and asset allocation. Here’s the taxation on mutual funds:
Equity Mutual Funds
- Short-Term Capital Gains (STCG): The gains from equity mutual funds held for less than 12 months are now taxed at 20%. This is an increase from the previous tax rate of 15%.
- Long-Term Capital Gains (LTCG): For equity mutual funds held for over a period of over 12 months, gains are classified as long-term capital gains. The tax-free limit for long term capital gains has increased to ₹1.25 lakh per year, up from ₹1 lakh. Gains above this limit are now taxed at 12.5%, an increase from the previous 10%.
Additionally, the indexation benefit, which adjusted purchase prices for inflation to reduce taxable gains, has been removed for all asset classes. Now, long-term capital gains are taxed at a flat 12.5% without indexation.
| Capital Gains Tax | Holding Period | Old Rate | New Rate |
| Short-Term Capital Gains (STCG) | Less than 12 months | 15% | 20% |
| Long-Term Capital Gains (LTCG) | More than 12 months | 10% | 12.50% |
Debt Mutual Funds
- Short-Term Capital Gains (STCG): If you sell your debt fund units within a period of 36 months, the gains are classified as short-term capital gains. The STCG will be taxed according to your income tax slab rate.
- Long-Term Capital Gains (LTCG): For debt funds held for a period over 36 months, the gains are classified as long-term capital gains. A flat 12.5% tax now applies to capital gains, with the indexation benefit removed, meaning the entire gain after three years is taxable. For specified mutual funds with over 65% in debt, the holding period for long-term capital gains has been reduced from 36 to 24 months, but these gains will still be taxed according to the investor’s tax slab.
| Capital Gains Tax | Holding Period | Old Rate | New Rate |
| Short-Term Capital Gains (STCG) | Less than 36 months | Taxed according to your income tax slab | Taxed according to your income tax slab |
| Long-Term Capital Gains (LTCG) | More than 36 months | 10% | 12.50% |
Hybrid Mutual Funds
Short-Term Capital Gains (STCG)
The tax on short-term capital gains depends on the fund’s asset allocation when it comes to hybrid mutual funds.
- Equity-Oriented Hybrid Funds (more than 65% in equity): The gains from units sold within 12 months are taxed at 20%.
- Debt-Oriented Hybrid Funds (less than 65% in equity): The gains from units sold within three years are taxed according to your income tax slab.
Long-Term Capital Gains (LTCG)
The capital gains tax on hybrid mutual funds that extend the specified period (12 or 36 months) is known as the long-term capital gain tax.
- Equity-Oriented Hybrid Funds: The gains from units held for over a period of 12 months are taxed at 12.5%. The gains up to ₹1.25 lakh are tax-free.
- Debt-Oriented Hybrid Funds: The gains from units held for over a period of 36 months are taxed at 12.5% without indexation benefits. This means the entire gain is taxed at this rate without adjustment for inflation.
| Type of Hybrid Fund | Short-Term Capital Gains (STCG) | Long-Term Capital Gains (LTCG) | Indexation Benefit |
| Equity-Oriented Hybrid Funds | 20% for holdings less than 1 year | 12.5% for holdings over 1 year, with gains up to Rs. 1.25 lakh tax-free | Not available |
| Debt-Oriented Hybrid Funds | Taxed as per income tax slab for holdings less than 3 years | 12.5% for holdings over 3 years | Not available |
Note: Mutual fund schemes where neither the equity nor debt orientation exceeds 65% will now be classified as long-term investments after 24 months. The previous holding period for these funds was 36 months. These will be taxed at the revised LTCG tax rate of 12.5%.
Factors to Consider Before Investing in the SIP Mutual Funds
- Risk Exposure: SIP mutual funds invest in different asset classes, and their performance can fluctuate based on market volatility and economic conditions.
- Investment Horizon: Returns from SIPs may vary depending on the time frame over which contributions are made and markets evolve.
- Fund Category: Equity, debt, and hybrid SIPs carry distinct risk-return profiles, influencing potential outcomes across different economic cycles.
- Market Conditions: Broader market phases and sectoral trends often impact how SIP investments perform over time.
- Expense Ratios: Fund management charges can differ across schemes, which may influence overall returns.
- Historical Performance: Past trends provide insights into how a fund has managed varying market conditions, though they do not indicate future results.
- Tax Implications: Tax treatment differs across fund types, influencing post-tax returns for investors.
To Wrap It Up…
Choosing the right mutual fund for your SIP investment among over 5,500 available in India may seem daunting, but it’s crucial for financial success. Explore the SIP plans listed and use the smallcase SIP calculator to analyse their returns. Don’t forget to assess factors like fund house reputation, historical returns, NAV, and risk before making a decision. Explore some of the best SIP plans to invest in on smallcase for a comprehensive view.
Looking for a Loan Against Mutual Funds (LAMF)? Explore LAMF on smallcase –
You can now apply for a loan against mutual funds (LAMF) on smallcase. Explore the quick and paperless process with the following articles about the eligibility criteria, documents required, features, benefits and more on LAMF at smallcase!
Frequently Asked Questions (FAQs) on the Mutual Funds for SIP
Based on the 3-yr CAGR, here are the top mutual funds that allow SIP investments
– Edelweiss US Technology Equity FOF
– Bandhan Small Cap Fund
– Franklin India Opportunities Fund
– SBI PSU Fund
– Invesco India PSU Equity Fund
Note: This data on short and long-term SIP funds is as of 8th September 2025. This information is intended for educational purposes and should not be construed as a recommendation or advice.
It depends on your investment goals. Your decision should align with key factors. Perpetual SIPs offer flexibility by eliminating an end date, allowing you to halt them at your discretion.
The best SIP mutual funds invest in a diversified portfolio of stocks, bonds, and other securities to maximise returns and manage risk effectively.
It is essential to verify the current lock-in period for specific SIPs by checking with the respective mutual fund companies or consulting updated financial sources.
A Systematic Investment Plan (SIP) is a method of investing in mutual funds. Instead of making a lump-sum investment, investors can spread their investment over time by investing a fixed amount regularly. SIPs work by leveraging the power of compounding and provide a disciplined approach to wealth creation.
