Top Performing Pharma and Healthcare Mutual Funds in Last 3 Years

Indian pharmaceutical stocks surged 5 per cent on Thursday, defying a broader market decline, following the U.S. administration's decision to exempt pharmaceutical products from new reciprocal tariffs.

Indian pharmaceutical stocks surged 5 per cent on Thursday, defying a broader market decline, following the U.S. administration's decision to exempt pharmaceutical products from new reciprocal tariffs. This development propelled all 20 constituents of the CNX Pharma index higher, marking its best intra-day performance in over four years. While the benchmark Nifty 50 declined by 0.4 per cent, the pharma sector experienced renewed investor interest.

The United States imports nearly a third of Indian pharmaceutical exports, valued at approximately USD 9 billion last fiscal year. With President Donald Trump's administration imposing a 26 per cent reciprocal tariff on Indian imports starting April 5, pharmaceutical goods received an exemption. This relief temporarily safeguards a crucial segment of India's export economy, though analysts caution against potential sector-specific tariffs in the future.

Top Performing Funds:

SBI Healthcare Opportunities Fund has an AUM of Rs 3,312.89 crore and a total expense ratio (TER) of 0.97 per cent. The fund has delivered a 1-year return of 18.09 per cent and a 3-year return of 23.57 per cent. Its top holdings include Sun Pharmaceutical Industries Ltd. (13.47 per cent), Max Healthcare Institute Ltd. (6.5 per cent), and Divis Laboratories Ltd. (6.2 per cent). The fund benefits from a diversified exposure to leading pharmaceutical and healthcare companies, positioning itself well in the current market rally.

ICICI Pru Pharma Healthcare and Diagnostics Fund has the highest AUM among sector funds at Rs 4,611.47 crore, with a TER of 1.11 per cent. The fund has provided 1-year returns of 18.83 per cent and 3-year returns of 23.4 per cent. Its top holdings are Sun Pharmaceutical Industries Ltd. (13.21 per cent), Cipla Ltd. (9.55 per cent), and Dr. Reddy’s Laboratories Ltd. (8.94 per cent). The fund's allocation to well-established pharma giants strengthens its position amid growing demand for Indian pharmaceutical exports.

DSP Healthcare Fund manages Rs 2,950.74 crore in assets with a low TER of 0.63 per cent. The fund has delivered a 1-year return of 12.76 per cent and a 3-year return of 20.35 per cent. Its key holdings include Suven Pharmaceuticals Ltd. (10.25 per cent), Sun Pharmaceutical Industries Ltd. (10.13 per cent), and Cipla Ltd. (8.54 per cent). The fund's allocation to mid-sized pharma companies along with established leaders provides a balanced exposure to the sector.

UTI Healthcare Fund has an AUM of Rs 1,057.17 crore with a TER of 1.22 per cent. The fund has posted a 1-year return of 19 per cent and a 3-year return of 20.28 per cent. Its major holdings include Sun Pharmaceutical Industries Ltd. (10.93 per cent), Cipla Ltd. (6.19 per cent), and Dr. Reddy’s Laboratories Ltd. (4.57 per cent). The fund’s strategy focuses on pharmaceutical companies with strong domestic and export market presence, benefiting from the tariff exemption announcement.

Tata India Pharma & Healthcare Fund has an AUM of Rs 1,103.99 crore and a TER of 0.74 per cent. The fund has generated 1-year returns of 14.33 per cent and 3-year returns of 20.23 per cent. It holds significant positions in Sun Pharmaceutical Industries Ltd. (11.61 per cent), Dr. Reddy’s Laboratories Ltd. (7.23 per cent), and Aurobindo Pharma Ltd. (7.1 per cent). The fund’s allocation to a mix of large and Mid-Cap pharma companies enhances its growth potential in the current market scenario.

Sun Pharmaceutical Industries, a common holding in major healthcare funds, remains the sector leader. Other prominent companies include Cipla, Dr. Reddy’s Laboratories, and Aurobindo Pharma, which have gained from stable export demand and favorable regulatory policies.

The exemption of pharmaceutical goods from U.S. tariffs provides temporary relief for Indian drugmakers, reinforcing investor confidence. While the sector's growth prospects remain strong, potential future policy changes could impact long-term trends. Investors may consider pharma-focused funds to leverage ongoing market developments.

Disclaimer: The article is for informational purposes only and not investment advice.