Infrastructure mutual funds are sectoral mutual funds that primarily invest their corpus in stocks of construction companies, capital goods, and metals sectors. Statistics reveal that in 2020 private investors spent 35% of the investments in urban infrastructure. This upward trend continued in 2022 too and is bound to rise further in 2023. So, if you are into sectoral funds and want to invest in the best-performing infrastructure mutual funds, check out our list of 20 best infrastructure mutual funds 2023 in India you can consider investing in.
Here are the best infrastructure mutual funds 2023 in India that you can invest:
|Quant Infrastructure Fund
|NAV: ₹23.25AUM: ₹822.24 CroreExpense Ratio: 0.64%
|Invesco India Infrastructure Fund
|NAV: ₹32.37AUM: ₹445.72 CroreExpense Ratio: 2.52%
|ICICI Prudential Infrastructure Fund
AUM: ₹2269.74 Crore
Expense Ratio: 2.24%
|Canara Robeco Infrastructure Fund
AUM: ₹247.01 Crore
Expense Ratio: 1.32%
|Tata Infrastructure Fund
AUM: ₹950.90 Crore
Expense Ratio: 1.43%
|Kotak Infrastructure and Economic Reform Fund
AUM: ₹727.29 Crore
Expense Ratio: 2.46%
|Franklin Build India Fund
AUM: ₹1184.02 Crore
|SBI Infrastructure Fund
AUM: ₹927.81 Crore
Expense Ratio: 2.33%
|DSP T.I.G.E.R Fund
Expense Ratio: 1.41%
|Bandhan Infrastructure Fund
AUM: ₹615.41 Crore
Expense Ratio: 1.15%
|Aditya Birla Sun Life Infrastructure
AUM: ₹562.19 Crore
Expense Ratio: 2.53%
|Nippon India Power and Infra Fund
AUM: ₹1871.13 Crore
Expense Ratio: 1.59%
|HDFC Infrastructure Fund
AUM: ₹593.28 Crore
Expense Ratio: 1.75%
|HSBC Infrastructure Fund
AUM: ₹1476.31 crore
Expense Ratio: 2.21%
|Sundaram Infrastructure Advantage Fund
AUM: ₹594.76.27 Crore
Expense Ratio: 2.53%
|UTI Infrastructure Fund
AUM: ₹1445.69 Crore
Expense Ratio: 2.31%
|LIC MF Infrastructure Fund
AUM: ₹9027 Crore
Expense Ratio: 2.61%
|SBI Technology Opportunities Fund
AUM: ₹2861.77 Crore
Expense Ratio: 0.88%
|Nippon India Power & Infra Funds
AUM: ₹1871.13 Crore
Expense Ratio: 1.59%
|IIFL Quant Fund Direct Plan Growth
AUM: ₹61.43 Crore
Expense Ratio: 0.43%
Quant Mutual Fund made this scheme available to investors first on April 15, 1996. Vasav Sehgal, Ankit A Pande and Chandramouli Alla are the fund managers of Quant Infrastructure Fund. This scheme aims to invest in equity and equity-related instruments of infrastructure companies.
Invesco Mutual Fund launched this scheme to invest in stocks of infrastructure companies and gain capital appreciation. Most of the equity assets of this scheme are allocated in the capital goods and construction sectors. This scheme was started on July 24, 2006. Amit Nigam is the fund manager who is looking after these funds.
This scheme was launched for investors on October 12, 1993. Lhab Dalwai and Priyanka Khandelwal are the present fund managers. This scheme plans to generate capital growth and portfolio diversification by investing in stocks of infrastructure-based companies.
Vishal Mishra and Shridatta Bhanwaldar are the fund managers of this scheme. Canara Robeco Infrastructure Fund was launched by Canara Robeco Mutual Funds on December 19, 1987. The exit load of this fund is 1% if investors redeem within a year.
Tata Infrastructure Fund was introduced by Tata Mutual Funds on June 30, 1995. Abhinav Sharma is the present fund manager of this scheme. This scheme aims to offer capital growth and income distribution by investing in equity and equity-related instruments of companies that deal with infrastructure.
This mutual fund scheme was incorporated on August 5, 1994, by Kotak Mahindra Mutual Funds. Its CRISIL rank is 4, indicating above-average performance among infrastructure funds. Arjun Khanna and Harish Krishnan are the fund managers who are presently operating this scheme.
Franklin Templeton Mutual Fund Growth launched this scheme on February 19, 1996. 54.06% of the fund’s assets are in large cap stocks, 24.36% in small cap stocks and the rest in mid cap stocks. Its CRISIL rank has downgraded from to 2 from 3, indicating below-average performance. Sandeep Manam, Ajay Argal and Kiran Sebastian are the fund managers of this scheme.
SBI mutual funds launched this scheme for investors on June 29 1987. This fund invests primarily in companies directly or indirectly involved with Indian infrastructure projects. Mohit Jain and Bhavin Vithlani are the fund managers who are handling this scheme.
DSP mutual funds launched this scheme for investors on December 16, 1996. Jay Kothari, This infrastructure fund invests 39.14% of its assets in small cap stocks, 31.42% in large cap stocks and 19.96% in mid-cap stocks. Charanjit Singh and Rohit Singhania are the fund managers overlooking this scheme.
This scheme was made available to investors by IDFC mutual funds on December 20, 1999. It invests in domestic companies participating in or benefiting from infrastructure development. The portfolio turnover ratio of IDFC Infrastructure Fund is 5%, much lower than the category average of 163.71%. Sachin Relekar is the current fund manager of this scheme.
Aditya Birla Sun Life Infrastructure was launched for investors on December 23, 1994. This scheme aims to provide medium-term to long-term capital appreciation from investments in infrastructure-related companies. Jonas Bhutta, Mahesh Patil and Dhawal Joshi are the fund managers of this scheme.
This equity mutual fund scheme was launched for investors on June 30, 1995, by Nippon India. It invests primarily in companies engaged in the infrastructure and power sector of India. Akshay Sharma and Sanjay Doshi are the fund managers running this scheme.
This scheme was launched for investors on December 10, 1999, by HDFC Mutual Funds. 41.17% of the total assets of this fund are large cap stocks while 36.31% are in small cap stocks and only 4.49% are in mid cap stocks. Rakesh Vyas and Priya Ranjan are the current fund managers who are overlooking this scheme.
This scheme was launched by HSBC mutual funds for investors on May 27, 2002. Most of its investments (67.24%) is in large cap stocks while the rest are in mid cap stocks and small cap stocks. Gautam Bhupal is the present fund manager running this scheme.
This equity mutual fund scheme was launched on February 26, 1996 by Sundaram Mutual Funds. Ashish Aggarwal, Ratish Varier, Rohit Seksaria are the fund managers managing this mutual fund scheme to fetch investors long-term returns from investments in infrastructure-related companies.
This equity infrastructure investment was launched by UTI Mutual Fund and was made available for investors on November 14, 2002. The fund follows a bottom-up strategy for stock selection and has concentrated exposure in certain companies. Sachin Trivedi functions as the present fund manager of this scheme.
LIC Mutual Funds made this scheme available to investors on April 20, 1994. This fund also promises to bring capital appreciation by investing in shares of companies directly or indirectly related to infrastructure. Yogesh Patil is the current fund manager of this scheme.
This scheme was incorporated for investors on June 29, 1987. Mohit Jain and Saurabh Pant are the present fund managers of this scheme. This scheme promises to fetch high returns by investing in assets of technology and technology-related companies.
This equity mutual fund scheme was incorporated for investors on June 30, 1995. This scheme aims to earn capital appreciation for investors by investing in assets of power and infrastructure-related companies. Akshay Sharma and Sanjay Doshi are the fund managers of this mutual fund scheme.
This equity mutual fund scheme was incorporated by IIFL Mutual Funds on March 22, 2010. It aims to bring in long term capital gains by investing in equity and equity-related instruments on quant themes. Parijat Garg is the present fund manager of this scheme.
Expected return rate (p.a)
Time Period (Years)
Infrastructure mutual funds work like any sectoral mutual funds that invest in stocks of a certain sector. These are a pool of funds that only focus on infrastructure companies. When an investor invests their funds here, fund managers study the movement of the infrastructure market and the industry accordingly.
Following this, they purchase shares of companies that show a projection of growth in the long run. These companies are mostly directly or indirectly related to the infrastructure industry. This includes companies dealing with or benefitting from real estate, power and energy.
Although these companies promise to bring in high returns, investors must know that these mutual funds can be a risky undertaking. An investor must be well aware of their investment goals and risk appetite before investing in these funds.
Since these funds are high-risk-high-reward, bull markets can fetch significant returns for infrastructure mutual funds. Growth of a particular sector can guarantee even higher returns and these types of funds are perfect for wealth multiplication within a time horizon of approximately 3 years.
Infrastructure mutual funds are sectoral and investing in such funds is guaranteed to improve the sector as well. This also indirectly helps in the growth of the nation’s economy. Conversely, certain government policies may also affect infrastructure mutual funds heavily. The right timing of entry and exit from these funds is crucial to capitalise on the returns and for this, the investors need to be experienced or have financial advisors who help them.
Sectoral-infrastructure mutual funds are great alternatives for investors looking forward to investing in the infrastructure sector. As these markets are tough for novice investors to predict, fund managers who are efficient in the art of studying the market are of immense value. They will invest your funds in stocks that have good potential for growth.
The Indian Government is investing a huge sum in infrastructural projects. Be it power, real estate, energy or construction, these projects show a great potential to bring in substantial returns for investors in the long run. With a growth in the country’s infrastructure, there is a large inflow of funds in this sector that are experiencing solid returns.
Infrastructure mutual funds are suitable for experienced or seasoned investors. Experienced investors are also advised to invest not more than 10% of total investments. Investors who want to capture the growth of India’s infrastructure could also consider these funds, however, it is important to note that investors who have been studying the nation’s infrastructural growth and have a strong affinity in thesecor usually invest in these funds.
Sectoral mutual funds like infrastructure mutual funds are one of the riskiest types of mutual funds in the market. Infrastructure mutual funds invest in just one sector. A fall in this particular sector affects the stocks to a greater degree with no safety net. If you decide to invest in infrastructure mutual funds, it’s advised to have an investment horizon of around 3 years or more.
Here are a few simple steps to guide you to invest in infrastructure mutual funds.
Register on the app or portal of your preferred broker, bank or NBFC.
Visit the ‘Mutual Funds’ section and choose the infrastructure funds you wish to invest in.
Tap on invest and select your mode of investment between SIP or lumpsum.
Enter your KYC details like name, phone number, email ID, address and PAN details.
Upload scanned copies of the required documents and click ‘submit’ to complete your investment.
It is highly crucial to evaluate the long-term investment goals before investing. Deciding the kind of returns you need, how much risk you’re willing to take, and the purpose of investing (for retirement, wealth generation, beat inflation, etc.) will help you map out your needs better. This will help you choose the perfect infrastructure mutual fund suitable to your needs.
Infrastructure mutual funds are high-risk-high-reward funds, which when invested for a period of approximately 3 years can generate huge returns in bull markets. Investors who have a high-risk appetite and wish to generate a lot of wealth long-term can invest in these types of funds. Align with your financial objectives to know if you are willing to take high-risk.
Past performance predicts future performance. Examining a mutual fund’s past performance before investing in it can give you meaningful insights as to how the said fund is going to perform in the future. A fund that was able to meet the goals set in the past is more likely to perform well in the future. Determining the selected fund’s historical returns and comparing it with other similar mutual funds in the market will also help in giving better clarity to you.
Almost all fund houses collect a fee called expense ratio from investors to cover all the administrative expenses (refer to the aforementioned table for particular expense ratios). This fee is a small percentage of a scheme’s total assets and differs from one fund to another in the market. It’s important to analyse each fund’s expense ratio and compare it with other similar funds before investing because while the ratio in itself might seem less, the absolute amount may be high.
Sectoral funds and infrastructure funds as a subset of those are essentially a class of equity funds. Thus, these follow the same tax structure as other equity funds. The capital gains earned on exit within 1 year are treated as Short Term Capital Gains (STCG) and are taxed at 15%.
If an investor holds investments for more than a year, the gains are classified as Long Term Capital Gains (LTCG) and are free if the profits fall under ₹ 1 Lakh, but taxed at 10% if the gains exceed ₹ 1 Lakh. 10% TDS (Tax Deducted at Source) is deducted on dividends exceeding INR 5000 earned.
Taxation on infrastructure mutual funds is quite similar to other equity funds. When the holding periods of such assets are less than a year, they bring in short-term capital gains. Whereas, when an investor holds them for more than a year, they fetch long term capital gains. These long-term and short-term capital gains of infrastructure mutual funds are taxed as follows.
The key to generating high returns is to hold on to the investments for a longer time horizon (approximately 3 years for infrastructure mutual funds) and let the wealth multiply. Identifying the best sectors that perform well despite the market conditions is important to gain high returns and the infrastructure sector is definitely one of them. If you are ready to start investing in the best infrastructure mutual funds 2023, you can visit Navi Mutual Fund.
*Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
Infrastructure mutual funds are a type of sectoral mutual funds that invest in stocks of companies involved in the infrastructure sector. The infrastructure sector is quite a broad sector with several sub-sectors that include construction, power, real estate, engineering and energy.
Yes, infrastructure companies offer dividends to their shareholders. These profits add to the corpus of infrastructure funds and investors indirectly benefit from such gains.
As a type of sector-specific investment, infrastructure mutual funds carry high credit risk for investors. One must have proper knowledge of this sector and marketplace to earn returns consistently. If you have a high-risk appetite and long investment horizon, you can invest in these funds.
The top Infrastructure mutual funds in India are:
1. Quant Infrastructure Fund
2. ICICI Prudential Infrastructure Fund
3. Canara Robeco Infrastructure Fund
4. Tata Infrastructure Fund
5. Aditya Birla Sun Life Infrastructure Fund
Infrastructure mutual funds have the potential to offer high returns, however, they come with very high risk due to their portfolio and sector-specific concentration. Therefore, it is good for investors with a huge risk appetite. This means investors who are ready to bear and overcome substantial losses should consider investing in these funds. You should consider your risk appetite and investment horizon before investing.
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Disclaimer: Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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