Sectoral and Thematic Mutual Funds Witnessed Decline in 2025; Falling as Much as 26%
Sectoral and thematic mutual funds have seen a decrease in 2025, with all schemes posting negative returns till now. The fall has been quite high, with losses of up to 26% in the period. Statistics for the year show that as many as 197 such funds have been impacted by this phenomenon.
Among the funds, the Motilal Oswal Manufacturing Fund posted a return of 22.68% in 2025. Very close on the heels, the Kotak Infra and Economic Reform Fund was down 22.65%. HDFC Defence Fund, an industry-focused one that focuses on the defence industry, reported a negative return of 21.43% during the period.
Two funds of Invesco Mutual Fund, the Invesco India Technology Fund and Invesco India Infrastructure Fund, also dipped, providing negative returns of 20.99% and 20.74%, respectively. In 2025, the Kotak Special Opportunities Fund and Bandhan Innovation Fund both experienced losses of around 17.68%.
Quant Mutual Fund’s Manufacturing Fund and Business Cycle Fund also registered significant falls, down by 16.59% and 16.44%, respectively. Both Motilal Oswal Business Cycle Fund and Tata India Consumer Fund fell by 15.80%, and SBI Energy Opportunities Fund and SBI Consumption Opportunities Fund went down by 15.35% and 15.17%, respectively.
Aditya Birla Sun Life Mutual Fund also saw losses in various schemes. The Aditya Birla SL Transportation and Logistics Fund declined by 14.45%, the Aditya Birla SL Digital India Fund lost 14.39%, and the Aditya Birla SL MNC Fund saw a negative return of 14.28% till now in 2025. The HDFC Pharma and Healthcare Fund also lost 13.75%, and the SBI Quant Fund lost 12.37%.
Four ICICI Prudential Mutual Fund schemes lost between 10.90% and 11.07% during this period. The ICICI Prudential Innovation Fund, the last of the funds to have double-digit negative returns, had fallen by 10.01%.
Also, about 37 sectoral and thematic funds had single-digit negative returns. The WOC ESG Best-In-Class Strategy Fund returned a loss of 9.99% in 2025. Banking and finance sector funds also experienced a downfall, with HDFC Banking and Financial Services Fund and Kotak Banking and Financial Services Fund falling by 6.96% each. DSP Banking and Financial Services Fund witnessed the minimum downfall among all the sectoral and thematic funds with a negative return of 2.64%. The study only took into account sectoral and thematic mutual funds, considering their regular and growth variants. The performance was considered from January 1, 2025, to the current date.
It should be noted that the analysis is not an investment suggestion. Investors should make their investment decisions based on their risk tolerance, investment period, and investment objectives instead of considering past performance alone.
