Can a Mutual Fund Deliver Over 20% in a Month? HDFC Defence Fund Did It in March 2025

A mutual fund delivering over 20% return in a single month may sound implausible, especially in a diversified market. Yet, the HDFC Defence Fund, a sectoral fund focused on defence and allied sectors, managed to achieve this rare feat in March 2025 by clocking an impressive 22.1% return.

Let’s break down the key details behind this exceptional performance—purely from an informational standpoint.

What is HDFC Defence Fund?

Launched on June 2, 2023, HDFC Defence Fund is an open-ended equity scheme that invests in companies from the defence and allied sectors. As of February 2025, the fund has an Assets Under Management (AUM) of ₹4,975.51 crore.

This scheme falls under the sectoral fund category, and it is benchmarked against the Nifty India Defence TRI (Total Returns Index).

The fund is managed by Mr Abhishek Poddar, who has been at the helm since inception.

Investment Objective

The fund’s objective is straightforward: To provide long-term capital appreciation by investing predominantly in equity and equity-related securities of defence and allied sector companies.

It’s worth noting, however, that there is no guarantee that this investment objective will be achieved. The nature of sectoral funds means that performance is often linked to specific macroeconomic or policy-driven triggers.

Performance Snapshot: March 2025

The standout statistic here is the 22.1% return recorded by the fund in March 2025 alone. This return is unusually high for any mutual fund, particularly within a single calendar month.

As of April 3, 2025, the Net Asset Value (NAV) for the growth option of the fund stands at ₹20.22.

Conclusion

Although the 22.1% monthly return by HDFC Defence Fund is certainly remarkable, it serves more as a case study in sector-specific volatility and momentum rather than a baseline expectation for investors.

Sectoral funds like these can experience periods of outperformance as well as high volatility, making them a compelling—yet potentially risky—avenue for investors looking to capitalise on specific themes.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.