HDFC Mid Cap Fund has reached a significant milestone by crossing ₹1 trillion in assets under management (AUM) in June 2026, becoming the third scheme from HDFC Mutual Fund to achieve this feat after HDFC Flexi Cap Fund and HDFC Balanced Advantage Fund. According to reports from Equitymaster.com, it is also the largest among funds that invest predominantly in lower market caps, with the second largest scheme in the category having an AUM of ₹67,600 crore. The achievement comes as the fund enters its 20th year, highlighting its remarkable journey of delivering consistent long-term wealth creation for investors.
Since its launch in June 2007, HDFC Mid Cap Fund has delivered a CAGR of 17.13%, outperforming its benchmark consistently. As reported by Equitymaster.com, the fund experienced a challenging phase between 2016 and 2021, during which it struggled to outperform the benchmark. However, the fund has staged a remarkable comeback over the last few years, delivering significant gains as its high conviction bets paid off. On a rolling three-year return basis, the fund has outperformed the benchmark Nifty Midcap 150 – TRI and the category average by a notable margin of 2-3%.
The fund is categorised under mid-cap funds and is mandated to invest at least 65% of its assets in equity & equity-related instruments of mid-sized companies, defined as those ranking 101st to 250th on full market capitalisation basis. According to Equitymaster.com, the fund follows a bottom-up approach to identify high-quality businesses for the long term and maintains a low turnover ratio of around 5-20%. The fund usually carries a large portfolio of 65-75 stocks with limited exposure in single stock well within the 5% mark to mitigate downside risk. As of June 2026, the fund held 76 stocks with top holdings in The Federal Bank, Max Financial Services, AU Small Finance Bank, Balkrishna Industries, and Fortis Healthcare.
The fund's portfolio is dominated by auto ancillaries, bank, healthcare, infotech, finance, and consumption that form 67.4% of its assets. As reported by Equitymaster.com, the fund invests primarily in mid-caps (around 65% of its assets), along with tactical allocation of 15-20% in small caps and 5-15% in large caps. As of June 2026, the fund has an allocation of 63.2% to mid-cap stocks, 10.7% to large-cap stocks, 18.2% to small-cap stocks, and the balance in cash. The fund maintains superior risk-adjusted returns with low volatility compared to the benchmark and category peers, as reflected in its remarkable Sharpe and Sortino ratios.
The fund is managed by Chirag Setalvad, the head of equities at HDFC AMC, since the inception of the scheme, providing stability at the fund management level. According to Equitymaster.com, the fund maintains diversification across a range of stocks and sectors and adopts a prudent investment approach, helping it adapt well despite its large corpus. The fund is led by a high-conviction-oriented fund manager who is a veteran in the mid and small cap space. However, the fund may underperform in the short run when the market is momentum-driven, as noted in the analysis.
