Several mutual funds from the midcap space have delivered up to 10% returns so far this year, according to data from ACE Mutual Fund. The strength in midcap stocks has helped investors achieve solid returns despite challenging macroeconomic conditions, with the Nifty Midcap 150 index rising to its 52-week high late last month. So far this year, the index is up 3.61%, demonstrating resilience against headwinds from the West Asia crisis that has driven crude oil prices higher and pressured the Indian rupee. Meanwhile, momentum stocks are showing exceptional performance with Agri-Tech India hitting the upper circuit at ₹129.34 with a 20% gain, while Standard Engineering surged 12.43% and Ponni Sugars Erode rose 9.90% on June 5, 2026, even as the broader Nifty 50 declined 0.23%. As per Livemint, experts suggest that now is the perfect opportunity for contrarian investors as large and mid-cap stocks are trading at attractive valuations.
Investor interest in midcap stocks remains robust, as evident from record inflows of ₹6,551.40 crore into mid-cap funds in April, representing an 8% monthly increase, according to data from the Association of Mutual Funds of India (AMFI). This compares sharply with large-cap funds, which saw inflows drop 15.3% to ₹2,525 crore as investors sought opportunities beyond India's blue-chip firms. The strong inflows reflect continued investor confidence in the midcap segment despite challenging market conditions.
HSBC Midcap Fund emerged as the leading performer with a 9.65% year-to-date gain, maintaining an NAV of ₹441.35 and assets under management of ₹13,400 crore. However, the fund carries a high expense ratio of 3.6%. ICICI Pru Midcap Fund followed with a 5.4% return, featuring a lower expense ratio of 1.53% and AUM of ₹7,500 crore. JM Midcap Fund delivered 4.6% gains with an expense ratio of 2.31% and AUM of ₹1,160 crore, while Quant Midcap Fund achieved 4.3% returns with an AUM of ₹7,900 crore.
The recent correction in the Indian stock market has created attractive entry opportunities for contrarian investors, as per Livemint. Pankaj Mathpal, founder of Optima Money, believes that buying at current levels is an opportunity, particularly for mutual fund investors who missed earlier market rallies. The Nifty mid-cap index is now trading at 29 times earnings and the Nifty small-cap index at 33 times earnings, according to VK Vijayakumar, Chief Investment Strategist at Geojit Investments. Experts recommend large and mid-cap mutual funds since large caps provide stability while midcaps offer growth potential, with most sectors including manufacturing, consumption, power, financial services, infrastructure, healthcare, education and digital services expected to remain strong.
The midcap funds have demonstrated strong long-term performance across multiple timeframes. HSBC Midcap Fund has delivered impressive returns of 18% in one year, 104% over three years, and 410% over ten years. ICICI Pru Midcap Fund has shown consistent growth with 14% returns in one year, 96% over three years, and 401% over ten years. JM Midcap Fund has added 6% in a year, 17% in two years, and 82% over three years, though its AUM remains relatively small. Quant Midcap Fund has struggled recently but has delivered 60% returns over three years and 375% over ten years. As per Livemint, large and mid-cap funds have been performing well, with the Nippon India Vision Large and Midcap Fund giving close to 17% returns over the last three years.
