List of Best Healthcare Mutual Funds in India
India’s healthcare sector is growing rapidly, with the industry expected to reach $372 bn by 2025, up from $280 bn in 2020. Factors like increasing population, rising chronic diseases, and advancements in medical technology drive this growth. Healthcare mutual funds invest in companies across pharmaceuticals, biotechnology, hospitals, and medical devices, offering a way to track the sector’s performance through a diversified equity-based approach. Investors can also gain exposure through health care index funds and the Nifty Healthcare Index Fund. This article explains how these funds work, their features, benefits, risks, and key factors to consider.
List of the Best Healthcare Mutual Funds in India
Here’s the list of the top-rated healthcare mutual funds in India, sorted by 3Y CAGR.
| Name | AUM | CAGR 3Y | Expense Ratio |
|---|---|---|---|
| ICICI Pru Pharma Healthcare & Diagnostics (P.H.D) Fund | 6,103.96 | 30.54 | 1.04 |
| UTI Healthcare Fund | 1,118.51 | 27.87 | 1.30 |
| SBI Healthcare Opp Fund | 3,963.38 | 27.62 | 0.91 |
| DSP Healthcare Fund | 3,190.15 | 26.57 | 0.60 |
| Tata India Pharma & Healthcare Fund | 1,339.00 | 26.19 | 0.62 |
| Nippon India Pharma Fund | 8,736.57 | 25.03 | 0.89 |
| Aditya Birla SL Pharma & Healthcare Fund | 845.30 | 24.94 | 1.02 |
| Mirae Asset Healthcare Fund | 2,908.21 | 24.53 | 0.49 |
| ITI Pharma & Healthcare Fund | 226.89 | 24.49 | 0.47 |
| LIC MF Healthcare Fund | 90.98 | 22.77 | 1.22 |
Disclaimer: Please note that the above table 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 Stock Screener and is subject to real-time updates.
Note: The data on the list of the healthcare funds is from 17th September, 2025. This data is derived from the Tickertape Mutual Funds Screener.
🚀 Pro Tip: You can use Tickertape’s Mutual Fund Screener to research and evaluate funds with over 50+ pre-loaded filters and parameters.
Overview of the Top 10 Healthcare Mutual Funds in India
ICICI Pru Pharma Healthcare & Diagnostics (P.H.D) Fund
This fund invests in Indian companies across pharmaceuticals, hospitals, and diagnostic labs. Holdings include clinics, medical testing services, and other healthcare sector mutual funds, providing exposure to multiple segments.
UTI Healthcare Fund
UTI Healthcare Fund holds shares in hospitals, medical service providers, and pharmaceutical manufacturers, combining companies from different areas to provide a broad picture of the healthcare industry.
SBI Healthcare Opp Fund
The fund focuses on firms producing drugs, running hospitals, and developing biotechnology solutions. Its holdings cover several areas without concentrating on a single segment, offering varied representation of medical mutual funds.
DSP Healthcare Fund
DSP Healthcare Fund buys stocks in pharmaceutical companies, medical technology firms, and healthcare service providers in India. It blends businesses involved in device manufacturing, hospital operations, and biotech solutions to cover multiple healthcare sectors.
Tata India Pharma & Healthcare Fund
This fund holds shares in pharmaceutical companies, hospitals, biotech firms, and healthcare service providers, creating a diverse equity mix across the industry.
Nippon India Pharma Fund
The fund invests in drug manufacturers, hospital operators, and other healthcare-related companies, maintaining exposure to different segments within India’s healthcare sector.
Aditya Birla SL Pharma & Healthcare Fund
It invests across pharmaceuticals, biotechnology, and healthcare services, including hospitals and biotech innovators.
Mirae Asset Healthcare Fund
This fund owns shares in pharmaceutical, hospital, and biotechnology companies, combining holdings across multiple healthcare areas.
ITI Pharma & Healthcare Fund
The fund covers pharmaceutical production, hospitals, biotechnology, and service providers, reflecting a wide range of healthcare activities.
LIC MF Healthcare Fund
LIC Mutual Fund Healthcare Fund includes hospitals, drug manufacturers, and biotechnology companies, keeping broad exposure across different parts of India’s healthcare sector.
What are Healthcare Mutual Funds?
Healthcare mutual funds pool capital from investors and invest in companies operating in the healthcare sector, including pharmaceuticals, biotechnology, medical devices, and healthcare services. They invest mainly in stocks to provide exposure across the healthcare industry and track top health care mutual funds.
Taxation on Healthcare Mutual Funds
Since many healthcare mutual funds in India are equity-oriented (index funds or active equity funds), their taxation follows the rules for equity mutual funds as per the 2024 Union Budget.
| Capital Gains Type | Holding Period | Tax Rate (Budget 2024) | Notes |
| Short-Term Capital Gains (STCG) | Less than 12 months | 20% | Applies if units are redeemed within 1 year. |
| Long-Term Capital Gains (LTCG) | More than 12 months | 12.5% flat (up to ₹1.25 lakh per year tax-free) | No indexation benefit available. |
How to Invest in Healthcare Mutual Funds?
You can easily start to invest in healthcare mutual funds by following these steps:
- To invest in the best healthcare mutual funds, you can visit a mutual fund investment platform such as smallcase.
- The next step is to research and identify the healthcare mutual funds that match your financial goals. 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 healthcare mutual fund SIP, and complete the process.
Types of Healthcare Mutual Funds
- Pharmaceutical Funds: These funds invest in companies that manufacture and sell medicines, vaccines, and other health-related products. They focus on businesses with established revenue and regulatory approvals to provide exposure to the core pharmaceutical industry.
- Biotech Funds: Biotech funds invest in companies working on research-driven healthcare solutions such as gene therapy, diagnostics, or novel drug development. Performance can change based on clinical trial results, regulatory approvals, or research breakthroughs, making this segment more volatile.
- Healthcare Sector Funds: These funds invest across the healthcare ecosystem, including hospitals, healthcare providers, medical service companies, and equipment manufacturers. They spread investments across sub-sectors to reduce concentration risk in any single area.
- Medical Devices Funds: These funds focus on companies that design, manufacture, and distribute medical devices, equipment, and diagnostic tools. Returns depend on technology adoption, product approvals, and growth in healthcare infrastructure.
Advantages of Investing in Healthcare Mutual Funds
- Growth Potential: The healthcare sector in India has been expanding steadily and is projected to reach $372 bn by 2025. Increasing demand for medical services, improvements in technology, and an aging population contribute to this growth. Mutual funds that track healthcare companies mirror these trends.
- Diversification: These funds invest across different sub-sectors such as pharmaceuticals, hospitals, and medical devices. By spreading investments across multiple companies and areas, they reduce reliance on the performance of any single stock or segment.
- Defensive Nature: People continue to need medical care, medicines, and health services even when the economy slows down. This consistent demand can make the healthcare sector relatively stable compared with other industries that fluctuate more with economic cycles.
Risks of Investing in Healthcare Mutual Funds
- Regulatory Risk: Healthcare companies operate under strict government rules. Changes in policies, new compliance requirements, or shifts in pricing and approval procedures can affect the financial results of these companies and the mutual funds that hold their stocks.
- Market Volatility: Healthcare equity funds can fluctuate due to clinical trial results, product approvals, or market sentiment. Even established pharmaceutical companies can experience sudden price swings when regulators announce new information.
- Sector-Specific Risks: Sub-sectors like biotechnology or experimental therapies have higher risk. Fund performance depends on the success of new treatments, patents, or research outcomes and can vary widely based on these developments.
Factors to Consider Before Investing in Healthcare Mutual Funds
- Investment Goals: Healthcare mutual funds invest mainly in companies in the healthcare sector. Fund performance depends on sector growth and can affect long-term investment outcomes.
- Fund Performance: Historical data shows how a fund has responded to market conditions. This information helps understand past trends but does not predict future results.
- Risk Tolerance: The healthcare sector includes biotechnology and pharmaceuticals, which can show large price swings. Volatility in this sector is generally higher than in more stable industries.
- Fund Fees: Expense ratios and other management fees differ across funds. These costs affect net returns over the investment period.
Who Can Consider Investing in Healthcare Mutual Funds?
- Long-Term Investors: Investors with longer horizons can experience sector-specific growth trends and cyclical developments over time.
- Investors Seeking Diversification: Health sector mutual funds provide exposure to a sector that behaves differently from technology, finance, or industrial sectors, offering potential portfolio diversification.
- Risk-Tolerant Investors: The healthcare sector, particularly biotechnology, can have high fluctuations in stock prices, influencing overall portfolio volatility.
To Wrap Up…
Healthcare mutual funds invest in companies across the healthcare sector. The industry continues to expand due to rising global health needs. These funds allow investors to gain exposure to this growth while understanding associated risks and fund characteristics. Health mutual funds offer a way to track this performance through diversified investments.
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Frequently Asked Questions About Healthcare Mutual Funds
They invest in companies in the healthcare sector, including pharmaceuticals, biotechnology, medical devices, and healthcare services. They focus on equity investments in businesses within this industry.
Risks include market volatility, regulatory changes, and sector-specific factors. Sub-sectors like biotechnology depend on new drug developments or medical breakthroughs, which can increase risk.
These funds collect money from investors and invest it in a diversified portfolio of healthcare companies. Holdings can include pharmaceuticals, medical devices, and healthcare services.
Main types include pharmaceutical funds, biotech funds, healthcare sector funds, and medical devices funds. Each type focuses on a different segment of the healthcare industry.
They involve equity investments in healthcare companies, and performance can change due to market and sector factors. Investors may review trends, research funds, and use tools like mutual fund screeners such as Tickertape for analysis.
The best health sector mutual fundsFunds differ in focus, costs, risk, and historical performance. Investors can review these factors, research, consult financial advisors, and explore top medical mutual funds using platforms like Tickertape.
Healthcare funds can be more stable than other sectors since healthcare services remain in demand during economic slowdowns. Performance can still be affected by sector-specific developments.
Healthcare funds invest in companies with demand patterns that may differ from other sectors. Performance varies with economic and industry-specific changes. Investors may research, consult advisors, and use platforms like Tickertape for insights.
