Review of top-performing ETFs in India
Exchange-Traded Funds, or ETFs, have become a favorite choice for many investors in India over the past few years. They combine the best features of mutual funds and stocks. Investors get the benefit of diversification like mutual funds, but they can also buy and sell ETFs on the stock exchange just like individual shares. With lower costs, higher liquidity, and transparent structures, ETFs are steadily becoming the backbone of long-term portfolios in India.
In 2025, a few ETFs have clearly stood out. Some of them track well-known indices such as the Sensex or Nifty, while others are focused on specific sectors like banking, mid-cap companies, or public sector enterprises. This review takes a closer look at the top-performing ETFs in India, explains why they are doing well, and highlights what investors should keep in mind when considering them.
CPSE ETF: The Star Among PSU Funds
The CPSE ETF has emerged as one of the strongest performers in recent years. It invests in large public sector companies, many of which operate in energy, infrastructure, and strategic industries. The government’s focus on disinvestment and reforms in state-run enterprises has created strong momentum in these stocks.
Investors have rewarded this ETF with higher demand, and as a result, its long-term returns have been very attractive. Its performance shows that public sector companies, often overlooked in the past, are gaining new life thanks to fresh capital, better efficiency, and improved management practices.
Nippon India ETF Nifty Midcap 150: Riding the Midcap Boom
Another strong performer is the Nippon India ETF Nifty Midcap 150. This fund focuses on mid-sized companies that are often at the center of India’s consumption story. In the past year, midcap stocks have enjoyed a spectacular rally. Strong earnings growth, rising domestic consumption, and investor interest in high-growth companies pushed this ETF’s returns to impressive levels.
Midcap stocks are usually more volatile than large companies, but when the economy is strong, they often deliver better growth. That is exactly what we see with this ETF, which has given outstanding one-year returns. For investors willing to take some additional risk, midcap ETFs like this one offer a powerful opportunity.
Motilal Oswal Midcap 100 ETF: Another Midcap Winner
Motilal Oswal’s Midcap 100 ETF has also delivered excellent returns. Like the Nippon ETF, it rides the wave of strong midcap performance, though it tracks a slightly different index. Investors have flocked to it as a way to participate in India’s mid-sized growth companies without the risk of choosing individual stocks.
The growth of these ETFs highlights the faith investors have in India’s rising companies. As sectors like manufacturing, retail, and technology expand, many midcaps are moving into leadership positions in the economy. This ETF captures that trend effectively.
UTI S&P BSE Sensex ETF: Stability with Low Cost
Not every investor wants high risk and volatility. For conservative investors, the UTI Sensex ETF has remained a trusted option. It tracks the Sensex, which represents 30 of the largest and most established companies in India. The returns here are steadier, and the costs are among the lowest in the category.
This ETF is perfect for those who want to build a strong foundation for their portfolio. It provides exposure to market leaders like Reliance, Infosys, and HDFC Bank, and it does so with a minimal expense ratio. In simple terms, it is a safe, reliable vehicle for long-term wealth building.
Nippon India ETF Nifty Bank BeES: Focus on Financial Powerhouses
The Nippon Nifty Bank BeES ETF is one of the oldest and most trusted ETFs in India. It focuses only on the banking sector. Given the importance of banks to India’s economic growth, this ETF continues to attract steady interest.
While it has not delivered the explosive returns of midcap funds recently, it remains a strong choice for investors who believe in the long-term potential of Indian banks. As credit growth picks up and financial inclusion spreads, the banking sector’s growth is likely to continue, and this ETF provides direct exposure to that story.
Bharat 22 ETF: A Mixed Bag of Public Enterprises
The Bharat 22 ETF was launched to give investors access to a broad mix of public sector enterprises across industries like energy, finance, and infrastructure. Over the long term, its performance has been solid, but in recent years, it has lagged behind the CPSE ETF.
The fund has the right mix of large companies, but its returns depend heavily on government policy and execution of reforms. For investors who want exposure to a wide basket of state-run enterprises, it remains a useful option, but it has not kept pace with the best performers in the market.
The Rise of Thematic and Sectoral ETFs
Apart from traditional index-based ETFs, thematic and sector-focused ETFs have started to make waves in India. Funds that focus on electric vehicles, digital consumption, and even defense companies have been launched recently. For example, ETFs linked to new-age automotive and EV companies have given strong early returns. Similarly, defense-focused ETFs gained traction as India increased spending in that sector.
These funds allow investors to place targeted bets on specific trends. They come with higher risk because they are not diversified across the entire market, but for those who want to ride specific themes like technology, green energy, or defense, they provide a convenient option.
Global Interest in Indian ETFs
Internationally, India remains an attractive destination for ETF investors. Global ETFs that track Indian markets have gained significant attention in recent years. Although some global India-focused ETFs faced short-term corrections, the long-term view remains bullish. Foreign investors see India as one of the fastest-growing major economies, with a young population, rising income levels, and expanding consumption base.
The performance of Indian ETFs is not only drawing domestic money but also foreign inflows. This combination strengthens the case for continued growth in the Indian ETF market.
Looking Ahead
The future of ETFs in India looks bright. As more investors move toward low-cost, transparent, and diversified investment options, ETFs are set to grow further. With new themes such as renewable energy, artificial intelligence, and electric mobility gaining momentum, we can expect more innovative ETF launches in the coming years.
For now, the strongest performers are clearly midcap-focused ETFs and PSU-linked funds. Conservative investors may stick to broad-market funds like the Sensex ETF, while more adventurous investors may explore thematic ETFs for higher returns. The key lies in balancing core holdings with selective growth bets.
Conclusion
The Indian ETF landscape has evolved rapidly, offering investors a wide range of options—from safe, low-cost funds that track benchmarks to bold thematic funds that capture emerging trends. Midcap ETFs like Nippon and Motilal Oswal have been the stars of the last year, while CPSE ETF has proved that public sector companies can deliver remarkable long-term returns.
At the same time, traditional funds like the UTI Sensex ETF and sector-based options like Nifty Bank BeES provide stability and consistency. Thematic ETFs are the newest entrants, capturing investor imagination by focusing on future-ready sectors.
For Indian investors, the lesson is clear: ETFs are no longer just a side option—they are becoming a central part of modern portfolios. By combining stability with growth, and diversification with innovation, ETFs in India are helping investors build wealth in smarter, simpler, and more effective ways.
