If you are planning to invest in defence sector mutual funds, this update is important. HDFC Asset Management Company has introduced new rules for its popular HDFC Defence Fund.
These changes came into effect from May 4, 2026, and mainly impact new investors.
New Investment Rules: What Has Changed?
The fund house has tightened investment limits to control the inflow of money into the scheme.
SIP Limit Increased
New investors can now invest up to ₹10,000 per month through a Systematic Investment Plan (SIP). Earlier, the limit was ₹5,000 in December 2025.
STP Now Has a Cap
Investments through a Systematic Transfer Plan (STP) are now limited to ₹25,000 per month.
Only Monthly STP Allowed
New STP registrations will be accepted only on a monthly basis. Weekly and daily options are no longer available.
No Lump Sum Investment
The restriction on fresh lump sum investments and switching from other schemes continues.
Relief for Existing Investors
There is no need to worry if you are already investing in this fund.
These new rules apply only to new SIP and STP registrations. Existing investors can continue their investments without any changes.
Also, there are no restrictions on withdrawals. Investors can redeem their units or exit the scheme anytime.
Fund Performance and Portfolio Details
HDFC Defence Fund is the only actively managed mutual fund in India that focuses entirely on the defence sector.
Portfolio Breakdown
As of March 31, 2026, the fund had 22 stocks in its portfolio. Around 50.38% is invested in large-cap companies, while 25.14% is in small-cap stocks.
Fund Size (AUM)
The total assets under management (AUM) stood at ₹7,304 crore.
Strong Returns
The fund has delivered solid performance. It generated a 27.10% return in one year and an impressive 39.98% annualized return since its launch.