Best Defence Mutual Funds in India for February 2026: HDFC Defence Fund, Motilal Oswal Nifty India Defence Fund and More

Investing in defence mutual funds offers individuals an opportunity to participate in the growth of companies associated with the defence and aerospace sector. These funds primarily invest in businesses involved in manufacturing defence equipment, technology, and related infrastructure, which often benefit from consistent government spending and strategic national priorities. 

With global geopolitical uncertainties and rising defence budgets, these funds can provide both growth potential and a degree of stability, making them an attractive option for investors looking to diversify their portfolios while supporting a sector critical to national security. In this read, we’ll take a closer look at some of the best defence mutual funds in India for February 2026.

Best Defence Mutual Funds for February 2026: 1Y Return Basis

Note: The above-mentioned schemes have been selected based on 1Y Returns as of Feb 09, 2026

Overview of Top Defence Mutual Funds

1. Motilal Oswal Nifty India Defence Index Fund

• NAV: ₹10.15
• Tracking Error: 0.11

2. Aditya Birla SL Nifty India Defence Index Fund

• NAV: ₹11.08
• Tracking Error: 0.04

3. HDFC Defence Fund

• NAV: ₹23.93
• Tracking Error: 4.19

Also Read: Best Mutual Funds for Lump Sum Investments in India for February 2026: Bandhan Small Cap, Invesco India Midcap and More

Conclusion

Defence mutual funds present a unique investment avenue for those seeking exposure to a sector driven by long-term government contracts, technological innovation, and strategic importance. While they carry inherent risks tied to geopolitical developments and policy changes, the potential for steady returns and portfolio diversification makes them a compelling choice for risk-aware investors. 

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.