Top Stocks Favoured by Mutual Funds in September 2025: A Sectoral Deep Dive

September 2025 witnessed continued optimism in India's Mutual Fund industry as fund managers deployed capital strategically across market capitalisation segments. With Equity Fund inflows remaining robust at over Rs 30,000 crore, domestic institutional investors demonstrated confidence despite global headwinds. An analysis of mutual fund buying patterns reveals distinct preferences across Large-Cap, Mid-Cap and Small-Cap categories, offering valuable insights into where professional money managers are placing their bets.

Large-Cap Favourites: Banking and Consumer Giants Lead the Pack
In the large-cap segment, financial services stocks dominated mutual fund purchases during September 2025. Kotak Mahindra Bank emerged as the top pick with net purchases worth approximately Rs 3,932 crore, as multiple fund houses including HDFC and Mirae Asset aggressively added positions. The private sector lender's strong fundamentals and market leadership position made it an attractive choice for fund managers seeking stability amid market volatility.

ICICI Bank secured the second position with purchases aggregating Rs 3,790 crore, drawing significant interest from ICICI Prudential, HDFC and Mirae Asset mutual funds. The bank's consistent performance and robust asset quality continued to attract institutional capital. Eternal Limited (formerly Zomato) ranked third with Rs 3,272 crore in net buying, as fund houses like Aditya Birla Sun Life, Axis and Kotak increased their stakes substantially. The food delivery platform's improving unit economics and market expansion strategies resonated with growth-oriented fund managers.

Titan Company followed with Rs 3,151 crore in purchases, benefiting from its dominant position in India's jewellery and lifestyle sectors. Rounding out the top five was Interglobe Aviation (IndiGo) with Rs 3,018 crore in net purchases, as mutual funds bet on India's aviation recovery story and the airline's market leadership.

Mid-Cap Champions: FMCG and Healthcare Shine
The mid-cap category witnessed remarkable concentration in specific stocks, with Godfrey Phillips India standing out spectacularly at Rs 9,117 crore in net purchases—the single largest buying commitment across all market cap segments. The FMCG player attracted over 98 mutual fund schemes, up from 71 in August 2025, and delivered an impressive 87 per cent return in calendar year 2025 to date.

Cohance Lifesciences emerged as the second favourite with Rs 2,389 crore in purchases, featuring prominently in the portfolios of SBI, HDFC and Aditya Birla Sun Life mutual funds. The healthcare company's growth trajectory and sector tailwinds made it a consensus pick among fund managers. Dalmia Bharat, operating in the Construction materials sector, secured Rs 1,917 crore in investments as mutual funds positioned for infrastructure-driven growth opportunities.

Info Edge (India), the parent company of Naukri.com and other digital platforms, attracted Rs 658 crore in purchases, while Multi Commodity Exchange rounded out the top five with Rs 645 crore in net buying.

Small-Cap Darlings: Financial Services and New Economy Bets
The small-cap segment showcased mutual funds' appetite for emerging growth stories. Aptus Value Housing Finance topped the list with Rs 1,089 crore in purchases, as fund houses like Kotak increased allocations to specialised housing finance companies. Urban Company, the home services platform, secured Rs 973 crore in investments from funds including ICICI Prudential, reflecting confidence in the digitisation of service industries.

Sammaan Capital emerged as a consensus favourite with Rs 863 crore in purchases, appearing in the top picks of HDFC, Nippon India and DSP mutual funds. Asahi India Glass, serving the construction and automotive sectors, attracted Rs 678 crore in investments. OLA Electric Mobility completed the top five with Rs 481 crore in purchases as mutual funds positioned for India's electric vehicle revolution.

Broader Investment Themes
The September 2025 mutual fund buying patterns reveal several strategic themes. Fund managers demonstrated clear preference for quality financial services franchises in the large-cap space, while seeking alpha generation opportunities in mid-caps and small-caps. The significant allocation to Godfrey Phillips India and healthcare plays like Cohance Lifesciences suggests rotation into defensive FMCG and healthcare sectors.

Additionally, substantial investments in new economy stocks such as Eternal, Urban Company and OLA Electric indicate that fund managers are balancing traditional value plays with exposure to digital transformation and clean mobility trends. The diversification across sectors—spanning banking, consumer goods, technology, healthcare and construction—reflects a portfolio approach aimed at capturing growth while managing concentration risks.

Total mutual fund assets under management expanded to Rs 75.6 trillion in September 2025, with active equity funds recording inflows of Rs 30,422 crore. Systematic Investment Plan flows reached a record Rs 29,361 crore, underscoring sustained retail investor participation. This institutional and retail buying momentum has provided strong support to equity markets, with mutual funds adding over 30 lakh new folios during the month.

The buying patterns of September 2025 underscore mutual funds' continued faith in India's economic trajectory, with strategic allocations across market capitalisation segments positioning portfolios to benefit from both stability and growth opportunities in the evolving market landscape.

Disclaimer: This article is for informational purposes only and does not constitute financial advice; investors should consult a qualified advisor before making any investment decisions.