Best Equity Mutual Funds for May 2026 Based on 5‑Year CAGR: Aditya Birla SL PSU Equity Fund, SBI PSU Fund and More

Equity mutual funds focused on specific themes have delivered strong long‑term returns over recent years. Sector‑oriented schemes such as PSU and infrastructure funds tend to benefit from policy initiatives, capital expenditure cycles, and economic growth phases.

The 5‑year CAGR offers a long‑term perspective on how these funds have performed across varying market conditions. Based on data available for May 2026, the following equity mutual funds rank among the top performers on this metric.

Best Equity Mutual Funds Based on 5‑Year CAGR

Note: Data as of May 11, 2026

Aditya Birla Sun Life PSU Equity Fund

Aditya Birla Sun Life PSU Equity Fund invests primarily in shares of public sector undertakings across sectors such as banking, energy, power, defence, and infrastructure. The scheme follows a thematic investment approach focused on government‑owned enterprises.

Its portfolio may reflect policy‑driven developments, capital expenditure initiatives, and strategic disinvestment efforts. Due to its concentration in PSU stocks, the fund carries very high risk and may be sensitive to policy and sector‑specific changes.

SBI PSU Fund

SBI PSU Fund is a thematic equity scheme that invests in public sector companies across industries including banking, oil and gas, utilities, and industrials. The fund seeks long‑term capital appreciation through exposure to PSU businesses with earnings potential.

Portfolio performance can be influenced by government spending, reforms, and domestic manufacturing initiatives. The concentrated nature of the scheme makes it vulnerable to volatility arising from policy decisions and economic conditions.

ICICI Prudential Infrastructure Fund

ICICI Prudential Infrastructure Fund invests in companies connected to infrastructure development across construction, engineering, cement, energy, transportation, and capital goods sectors. The scheme follows an actively managed approach and allocates across market capitalisations within the infrastructure ecosystem.

It aims to capture opportunities arising from India’s long‑term infrastructure growth. The fund is categorised as very high risk due to its cyclical exposure and reliance on economic and capital expenditure trends.

DSP India T.I.G.E.R Fund

DSP India T.I.G.E.R Fund focuses on businesses expected to benefit from infrastructure development and economic reforms. The portfolio typically includes companies from industrials, construction, power, transportation, and materials sectors.

The scheme is actively managed and seeks opportunities linked to urbanisation and investment cycles. Its thematic focus results in higher volatility compared to diversified equity funds.

LIC MF Infra Fund

LIC MF Infra Fund invests in infrastructure‑related companies across power, construction, engineering, telecom, and transportation sectors. The scheme aims for long‑term capital appreciation by participating in India’s infrastructure expansion.

It follows an active investment strategy and may invest across different market capitalisations. The fund carries very high risk due to its sensitivity to economic growth and government spending patterns.

Nippon India Power & Infra Fund

Nippon India Power & Infra Fund focuses on companies operating in power generation, utilities, construction, capital goods, and engineering segments. The portfolio includes businesses linked to electricity demand, industrial growth, and infrastructure expansion.

Exposure may extend to renewable energy and transmission‑related companies. Concentration in infrastructure themes exposes the fund to significant fluctuations during policy or economic shifts.

Canara Robeco Infrastructure Fund

Canara Robeco Infrastructure Fund invests in companies engaged in infrastructure and allied sectors such as energy, cement, transportation, and industrial manufacturing. The scheme follows an actively managed approach aimed at long‑term capital appreciation.

It allocates across companies of varying market capitalisations depending on sector opportunities. Fund performance remains dependent on economic cycles, government expenditure, and project execution trends.

Invesco India PSU Equity Fund

Invesco India PSU Equity Fund invests primarily in equity and equity‑related instruments of public sector undertakings. Sector exposure includes financial services, oil and gas, defence, and utilities.

The scheme aims to capture valuation and growth opportunities within government‑owned enterprises. Its thematic concentration results in exposure to regulatory, sector‑specific, and policy‑related risks.

HDFC Infrastructure Fund

HDFC Infrastructure Fund invests in companies involved in engineering, energy, transportation, telecom, and construction materials. The scheme seeks long‑term capital appreciation through active stock selection within infrastructure‑linked sectors.

It typically maintains diversified exposure across infrastructure‑related industries. The cyclical nature of these businesses contributes to the fund’s very high‑risk classification.

Franklin Build India Fund

Franklin Build India Fund focuses on companies aligned with India’s infrastructure and construction‑led growth. The portfolio generally includes businesses from cement, engineering, industrials, transportation, and utilities sectors.

The fund follows an actively managed strategy targeting long‑term opportunities from government spending and urban development. Its thematic allocation exposes it to higher volatility during economic slowdowns and capex cycles.

Read More: Best International Mutual Funds in India for May 2026 Based on 5‑Year CAGR.

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Conclusion

Equity mutual funds featured in this list are largely driven by PSU and infrastructure‑led investment themes. Their long‑term performance reflects exposure to policy initiatives, capital expenditure cycles, and economic expansion trends.

Sector concentration plays a key role in return outcomes and volatility levels. As of May 2026, these funds highlight how thematic equity strategies have performed over a 5‑year period.

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.

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