Top 5 dividend yield funds based on 5-year returns: ICICI Prudential Dividend Yield Fund leads with 19.95% returns

Investors considering equity funds that combine long-term capital appreciation with exposure to companies known for regular dividend payouts may consider dividend yield funds.

These funds primarily invest in stocks with a consistent record of paying dividends, typically from companies with stable earnings, healthy cash flows and established market positions.

Among the schemes in this category, ICICI Prudential Dividend Yield Equity Fund has delivered the highest returns in the past five years. It is followed by LIC MF Dividend Yield Fund and HDFC Dividend Yield Fund, making them the top three performers during this period.

*CAGR as on 8 July, 2026, Portfolio holdings as on 31 May, 2026, Direct Plans, Source: Value Research

ICICI Prudential Dividend Yield Equity Fund delivered the highest 5-year CAGR of 19.95%, making it the best-performing dividend yield fund among its peers.

LIC MF Dividend Yield Fund secured the second spot with 5-year returns of 16.92%. HDFC Dividend Yield Fund ranked third, posting 5-year returns of 16.20%.

The fourth and fifth spots were taken by Tata Dividend Yield Fund and Aditya Birla Sun Life Dividend Yield Fund, which delivered 5-year returns of 15.45% and 14.39%, respectively.

When comparing the top three stock holdings, HDFC Bank emerged as the most common, featuring in the portfolios of four of the five funds. ICICI Bank was also among the top holdings of four funds, highlighting the banking sector's strong representation in dividend-focused portfolios.

Beyond these common names, each fund had a few distinct stocks among its top holdings. Sun Pharmaceutical featured among the top three holdings of ICICI Prudential Dividend Yield Equity Fund, while Garware Hi-Tech Films was in the LIC MF Dividend Yield Fund.

Similarly, Larsen & Toubro featured among the top three holdings of the Tata Dividend Yield Fund, while Aditya Birla Sun Life Dividend Yield Fund had a different set of top holdings, including NTPC, MCX and SBI.

Disclaimer: This is purely for educational/ informational purposes and should not be taken as any sort of investment advice. Always consult a SEBI-registered advisor before making any investment decisions.

Sheetal Goel is a Content Producer at Livemint, where she covers corporate developments, personal finance, business trends, markets, and SEBI-related updates. She focuses on simplifying complex financial concepts and presenting them in a clear, reader-friendly manner, thereby helping audiences better understand investment trends, personal finance, and market developments. Her writing focuses on making finance more accessible to everyday readers while maintaining clarity, accuracy, and relevance. <br><br> She holds a degree in Economics (Hons.) along with an MBA in Finance, which has helped her develop a strong foundation in financial analysis, market understanding, and business reporting. Before joining journalism, she worked with finance and broking firms, where she closely followed market developments, investment strategies, and evolving industry trends. This practical exposure strengthened her understanding of financial markets. She has also written content across multiple formats and platforms, including YouTube, LinkedIn, and Instagram. <br><br> Over time, she has developed expertise in covering market-linked stories, investor-focused topics, and regulatory updates in a simplified yet informative style. She also enjoys reading and listening to Hindi poetry, reflecting her appreciation for literature and creative expression beyond the world of markets and numbers.

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