Imagine your investment multiplying three-and-a-half to five times in just 10 years — sounds impressive, right? That’s exactly what one category of mutual funds has managed to achieve. The top 10 schemes in the value mutual fund segment have turned a Rs 1 lakh lump sum invested a decade ago into anywhere between Rs 3.60 lakh and Rs 5.16 lakh. We will explore their performance figures shortly, but first, let’s understand what value funds really mean.
What makes value mutual funds special?
Value mutual funds are equity funds that follow the value investing strategy. Under this approach, fund managers invest in stocks they believe are undervalued at that moment—stocks that are trading below their intrinsic worth. The idea is that over time, these stocks may unlock their true potential and rise to their real value.
Because of this value-unlocking opportunity, these funds have the potential to deliver high returns over the long term. However, higher return potential comes with higher risk. That is why value funds are placed in the very high-risk category.
Top 10 value funds: Highest annual returns in 10 years
Here we will discuss 10 value funds that have delivered the highest average annual returns (CAGR) over the past 10 years. We will also see how much a Rs 1 lakh investment in these funds’ direct plans 10 years ago would be worth today.
These funds include schemes from HDFC Mutual Fund, Nippon India Mutual Fund, ICICI Prudential Mutual Fund, and Tata Mutual Fund. We are also providing their expense ratios to show the cost of investing in these funds.
JM Value Fund (Direct Plan)
10-year annual return (CAGR): 17.83%
Rs 1 lakh investment after 10 years: Rs 5,16,790
Expense ratio: 0.98%
HSBC Value Fund (Direct Plan)
10-year annual return (CAGR): 17.34%
Rs 1 lakh investment after 10 years: Rs 4,95,560
Expense ratio: 0.76%
Bandhan Value Fund (Direct Plan)
10-year annual return (CAGR): 17.01%
Rs 1 lakh investment after 10 years: Rs 4,81,750
Expense ratio: 0.69%
ICICI Prudential Value Fund (Direct Plan)
10-year annual return (CAGR): 16.78%
Rs 1 lakh investment after 10 years: Rs 4,71,990
Expense ratio: 0.97%
Tata Value Fund (Direct Plan)
10-year annual return (CAGR): 16.74%
Rs 1 lakh investment after 10 years: Rs 4,70,810
Expense ratio: 0.81%
Nippon India Value Fund (Direct Plan)
10-year annual return (CAGR): 16.55%
Rs 1 lakh investment after 10 years: Rs 4,63,130
Expense ratio: 1.08%
Templeton India Value Fund (Direct Plan)
10-year annual return (CAGR): 15.77%
Rs 1 lakh investment after 10 years: Rs 4,32,980
Expense ratio: 0.87%
HDFC Value Fund (Direct Plan)
10-year annual return (CAGR): 15.49%
Rs 1 lakh investment after 10 years: Rs 4,22,560
Expense ratio: 0.99%
UTI Value Fund (Direct Plan)
10-year annual return (CAGR): 15.28%
Rs 1 lakh investment after 10 years: Rs 4,15,040
Expense ratio: 1.18%
Aditya Birla Sun Life Value Fund (Direct Plan)
10-year annual return (CAGR): 13.66%
Rs 1 lakh investment after 10 years: Rs 3,60,140
Expense ratio: 1.01%
(Source: AMFI, fund fact sheets, Value Research)
Who should consider investing in these funds
Although the top 10 value funds have delivered excellent returns over the past 10 years, past performance does not guarantee future results. Value funds invest in undervalued stocks, and the full benefit is realized only when the value is unlocked. Therefore, these funds are suitable for long-term investments—at least 5-7 years.
While looking at past returns, it’s also important to consider the cost of investing. The average expense ratio in this category is 0.91%, which is relatively higher compared to some other equity funds.
(Disclaimer: This article is for informational purposes only and is not investment advice. Always consult your investment advisor before making financial decisions.)
Note: This content has been translated using AI. It has also been reviewed by FE Editors for accuracy.