Dividend Yield Mutual Funds in India
Updated June 2026 · 12 active funds · data from AMFI NAVs · benchmark: NIFTY Dividend Opportunities 50 TRI
Dividend Yield funds are equity schemes that SEBI requires to invest at least 65% of assets predominantly in dividend-yielding stocks - companies that pay out a relatively high proportion of earnings as dividends. These tend to be mature, cash-generative businesses with steadier earnings, which often gives the category a value tilt and somewhat lower volatility than growth-oriented equity funds. The strategy aims to combine modest dividend income (reinvested into NAV in growth plans) with capital appreciation, and can hold up better in falling markets while sometimes lagging in sharp growth-led rallies. Note that the fund itself is taxed as an equity fund on the investor's gains - the 'dividend yield' refers to the stocks it picks, not a payout to you. In a portfolio, these funds serve investors who prefer a more conservative, income-quality slant within equity. The default benchmark on FindMF is the NIFTY Dividend Opportunities 50 TRI, which tracks high-dividend-yield stocks on a total-return basis. FindMF computes trailing returns, volatility, Sharpe, Sortino, drawdown and alpha/beta against this benchmark from AMFI daily NAVs using a disclosed methodology.
Who it suits: Investors who want an equity fund with a value and income-quality tilt and potentially lower volatility than growth funds.
80% of the 10 funds here with a computed alpha beat their benchmark over the measured window (positive alpha). Past performance is not indicative; this is analysis, not advice.
| # | Scheme | 1Y | 3Y | 5Y | Sharpe | Max DD | TER | AUM |
|---|---|---|---|---|---|---|---|---|
| 1 | ICICI Prudential Dividend Yield Equity Fund ICICI Prudential | -0.93% | +19.43% | +19.12% | 1.06 | -15.9% | 0.71% | ₹6.4K Cr |
| 2 | UTI - Dividend Yield Fund UTI | -2.86% | +16.78% | +13.23% | 0.60 | -20.1% | 1.51% | ₹2.4K Cr |
| 3 | Tata Dividend Yield Fund Tata | +4.85% | +16.66% | +14.88% | 0.58 | -20.4% | 0.67% | ₹998 Cr |
| 4 | Aditya Birla Sun Life Dividend Yield Fund Aditya Birla Sun Life | -2.22% | +16.37% | +14.91% | 0.70 | -20.7% | 1.35% | ₹1.5K Cr |
| 5 | HDFC Dividend Yield Fund HDFC | -3.68% | +14.64% | +15.65% | 0.76 | -20.0% | 0.86% | ₹5.8K Cr |
| 6 | Franklin India Dividend Yield Fund Franklin Templeton | -3.78% | +14.52% | +13.93% | 0.73 | -15.9% | 1.36% | ₹2.4K Cr |
| 7 | Sundaram Dividend Yield Fund (Formerly Known as Principal Dividend Yield Fund) Sundaram | -4.84% | +12.95% | - | 0.36 | -18.9% | 1.72% | ₹884 Cr |
| 8 | SBI Dividend Yield Fund SBI | -1.55% | +12.50% | - | 0.52 | -17.8% | 1.12% | ₹8.8K Cr |
| 9 | LIC MF Dividend Yield Fund LIC | -0.19% | - | - | 0.66 | -20.4% | 1.71% | ₹650 Cr |
| 10 | Baroda BNP Paribas Dividend Yield Fund Baroda BNP Paribas | -3.43% | - | - | -0.57 | -18.1% | 1.19% | ₹697 Cr |
Ranked by trailing return (3Y where available, else 1Y) on funds with at least one year of history. Returns, Sharpe, drawdown and TER are computed independently from AMFI NAVs - see methodology. No paid placement.
Frequently asked questions
How are Dividend Yield funds taxed?
They are equity-oriented funds (at least 65% Indian equity), so short-term gains (units held under 12 months) are taxed at 20%, and long-term gains (12 months or more) at 12.5% on the amount above Rs 1.25 lakh per financial year. This is separate from how dividends within the portfolio are handled by the fund.
Does a Dividend Yield fund pay me regular dividends?
Not necessarily. The 'dividend yield' refers to the high-payout stocks the fund buys, not a guaranteed payout to investors. Growth-plan investors see those dividends reinvested into NAV. If you want payouts, you would choose an IDCW plan, but FindMF excludes IDCW variants from performance math because their NAV drops on payout days.
What expense ratio is reasonable, and how do I compare these funds?
With only about a dozen active funds, the category is small, and TERs vary. Compare on FindMF using long-run alpha versus the NIFTY Dividend Opportunities 50 TRI, volatility, drawdown and TER together - all computed from AMFI NAVs - to see which funds delivered the defensive character the strategy promises.
Are Dividend Yield funds less risky than other equity funds?
They often carry lower volatility due to their mature, cash-rich holdings, but they are still equity funds with no capital protection and can fall in broad market declines. FindMF's volatility and drawdown metrics, derived from AMFI NAVs, show each fund's actual historical risk.