A Comparative Study on the Performance and Risk Analysis of Pharma Sector Mutual Funds in India

Abstract

This study examines the financial performance and risk analysis of selected mutual funds in India’s pharmaceutical sector. Mutual funds are becoming a popular investment avenue due to their diversification and professional management. However, investors often lack sufficient knowledge about risk factors, particularly in sector-specific funds like pharma. This study focuses on five leading pharma mutual funds: Nippon India Pharma Fund, Tata India Pharma & Healthcare Fund, SBI Healthcare Opportunities Fund, UTI Healthcare Fund and Aditya Birla Sun Life Pharma & Healthcare Fund. Using secondary data, including annual Net Asset Values (NAVs), asset size and returns over 1, 3, 5 years and during the COVID-19 period, the funds are analyzed using Sharpe’s and Treynor’s indices to assess risk-adjusted performance. Findings indicate that while Nippon India Pharma Fund consistently leads in returns, SBI Healthcare Opportunities Fund showed resilience during market downturns. COVID-19 caused negative returns across all funds, with ICICI Prudential Pharma Fund experiencing the largest decline. The study highlights the need for investor awareness regarding risk and recommends diversified portfolio strategies for better decision-making.