Market fluctuations may be fast or low, but staying invested in mutual funds for a long time gives you good benefits. Today we are going to tell you about one such fund which made an investment of just Rs 1 lakh into Rs 40.70 lakh. This fund ICICI Prudential Equity and Debt Fund is an open-ended aggressive hybrid scheme. It mainly invests in equity and fixed income securities.
Launched on November 3, 1999, the fund typically invests 65%-80% in equities and 20%-35% in fixed income instruments. This allows investors to participate in the growth of the equity market as well as benefit from the stability and income provided by debt securities. The hybrid structure allows the fund to dynamically adjust the allocation based on market conditions while maintaining its growth-oriented investment objective.
This is how Rs 1 lakh became Rs 40.70 lakh
By February 28, 2026, the lump sum investment of Rs 1 lakh made as initial investment (1999) has become approximately Rs 40.70 lakh. That means there is a CAGR return of 15.11%. The fund has also given CAGR (Compound Annual Growth Rate) returns of 19.53% and 18.87% respectively over a period of three and five years. During the same period, its benchmark CRISIL Hybrid 35+65 Aggressive Index has performed at a CAGR rate of 14.12% and 11.75% respectively. Talking about SIP, since the beginning, monthly investment of Rs 1,000 has become Rs 4.02 crore. Whereas the actual investment amount was only Rs 31.6 lakh. Even in the short term, SIP returns remain strong, offering CAGR of 18.15% and 11.85% over five and three years respectively. The fund has consistently outperformed its benchmark, CRISIL Hybrid 35+65 Aggressive Index, across all these time frames, demonstrating the effectiveness of its dynamic equity-debt allocation strategy in generating encouraging risk-adjusted returns.
What do experts say
S Naren, executive director, ICICI Prudential Mutual Fund, says hybrid funds play an important role in helping investors deal with uncertain and changing market scenarios, as they combine the growth potential of equities with the stability of fixed income. Our approach in this fund is based on dynamically balancing equity and debt based on relative valuation, risk-return and macroeconomic signals. This flexibility allows us to increase investments in equities when valuations are favorable and reduce risk when markets are expensive or volatile. This disciplined asset allocation framework and diversified portfolio over time has helped the fund deliver consistent results across cycles. We believe such a balanced approach is suitable for investors who want to create long-term wealth while managing volatility in their investment journey.
How did you get such a strong return?
The fund follows a diversified and flexible investment approach, and invests across different market capitalizations and sectors. As of February 28, 2026, the net equity exposure of the scheme was around 76%. The remaining investment was invested in high quality fixed income instruments. Within equities, the portfolio is primarily allocated to large-cap companies, with selective investment in mid-cap and small-cap stocks to enhance long-term growth potential. In the debt fund space, the fund focuses on high-quality instruments rated AA and above, including corporate bonds, government securities and other fixed income instruments. This approach is helpful in earning stable income while maintaining portfolio quality and managing downside risk.
For whom is this a better investment?
The fund adopts a combination of top-down and bottom-up investment approaches. Sector allocation decisions are guided by the macroeconomic outlook, valuation considerations and growth potential, while individual stock selection focuses on identifying fundamentally strong companies with sustainable earnings growth and reasonable valuations. This diversified approach enables the fund to take advantage of opportunities in different sectors while managing volatility. ICICI Prudential Equity & Debt Fund is suitable for investors looking for long-term wealth creation with relatively lower volatility compared to equity funds. It is also suitable for investors looking for balanced exposure to equity and fixed income through a single investment solution, especially those with an investment horizon of three years or more.