Introduction
Portfolio Management Services (PMS) have taken centre stage in India’s wealth management space. With high-net-worth individuals (HNIs) and affluent investors seeking customised strategies beyond mutual funds, PMS performance is being tracked more closely than ever.
So far in 2025, inflows into PMS have surged, driven by market volatility, regulatory changes, and investors’ preference for actively managed portfolios. But which strategies are attracting the most capital this year—and why? Let’s break it down.
What is PMS and Why Does it Matter?
Portfolio Management Services (PMS) allow investors with a minimum of ₹50 lakh to access tailor-made portfolios managed by experts. Unlike mutual funds where money is pooled, Portfolio Management Services creates a customized portfolio based on each investor’s goals and risk appetite. This bespoke approach is a key differentiator for the top portfolio management services in India, which leverage deep research and expert fund management to target alpha generation and wealth preservation for their discerning clients.
The appeal of PMS in 2025 lies in:
- Personalisation – bespoke portfolios aligned to financial goals.
- Flexibility – wider investment universe compared to mutual funds.
- Performance potential – opportunity to beat benchmarks in volatile markets.
PMS Industry Snapshot in 2025
According to SEBI data, PMS assets under management (AUM) have crossed ₹35 lakh crore in early 2025, compared to ₹32.1 lakh crore in January 2024. The number of PMS clients has also grown, though inflows are concentrated in select high-performing strategies.
Sectors leading the inflows include banking, manufacturing, technology, and defence, reflecting India’s economic momentum.
Top PMS Strategies with Highest Inflows in 2025
1. Large-Cap Growth Strategies
- Why the inflows? Stability plus growth. Investors are favouring blue-chip companies as markets face volatility.
- Performance highlight: Many large-cap PMS funds have delivered 12–14% annualised returns over the last year, slightly outperforming Nifty 50.
- Who it suits: Investors seeking relatively lower volatility while still capturing India’s growth story.
2. Mid & Small-Cap Opportunities
- Why the inflows? Investors are chasing high-growth companies in manufacturing, EV supply chains, and speciality chemicals.
- Performance highlight: Select mid-cap PMS strategies reported 18–20% returns in 2024, making them a magnet for inflows this year.
- Caution: These funds carry higher risk, but portfolio managers’ stock-picking expertise is driving confidence.
3. Sector-Focused PMS – Defence & Infrastructure
- Why the inflows? Government spending on defence modernisation and infrastructure projects has attracted investors.
- Performance highlight: Defence-focused PMS strategies have seen 30–35% inflows growth in just the first half of 2025.
- Case in point: The “Make in India” push is driving listed defence companies, and PMS managers are overweight in this space.
4. Quant & Tech-Driven PMS
- Why the inflows? Rising trust in data-backed models and algorithm-driven strategies.
- Performance highlight: Quant strategies have reduced volatility by 10–15% compared to discretionary PMS, while still beating Nifty benchmarks.
- Investor profile: Tech-savvy HNIs seeking consistency rather than aggressive bets.
5. Dividend Yield & Value Strategies
- Why the inflows? Investors are hedging against market swings with steady dividend-paying stocks.
- Performance highlight: Value-focused PMS strategies have attracted inflows of over ₹4,000 crore in Q1 2025, thanks to strong PSU and banking performance.
- Who it suits: Conservative investors looking for capital protection + income generation.
PMS Performance vs Mutual Funds in 2025
A recent PMS Bazaar study revealed that PMS strategies outperformed mutual funds by an average of 70% across timeframes.
This performance edge explains the record inflows into PMS this year, particularly from HNIs reallocating from mutual funds to more personalised portfolios.
Factors Driving PMS Inflows in 2025
- Regulatory confidence: SEBI’s tighter reporting norms are making PMS more transparent.
- Market volatility: Investors prefer active managers to navigate uncertainty.
- HNIs’ rising wealth: India added nearly 30,000 new millionaires in 2024, expanding the PMS investor base.
- Global diversification: Some PMS are offering access to overseas equities, adding to their appeal.
How to Choose the Right PMS Strategy
While chasing PMS performance, investors should keep these points in mind:
| Factor | What to Check | Why it Matters |
| Track Record | At least 3 years of performance | Avoid chasing only short-term gains |
| Portfolio Concentration | Number of holdings | Too concentrated = high risk |
| Manager Expertise | Background of fund manager | Consistency of decision-making |
| Fee Structure | Fixed + performance-linked fees | Ensure alignment with your returns |
| Withdrawal Flexibility | SWP (Systematic Withdrawal Plans) availability | Useful for regular income |
Conclusion
So far in 2025, the biggest inflows into PMS have gone to large-cap, mid-cap, defence, quant, and value strategies. Each reflects investors’ mix of caution and growth appetite.
As PMS continues to outpace mutual funds in performance, HNIs are betting big on customised strategies to grow and protect their wealth.
If you’re considering PMS, remember: Don’t just chase returns. Match the strategy with your financial goals, risk appetite, and liquidity needs.
Frequently Asked Questions
What is the minimum investment required for PMS in India?
The minimum is ₹50 lakh, as per SEBI guidelines.
Which PMS strategies are doing well in 2025?
Large-cap growth, mid-cap opportunities, defence and infra-focused, quant-based, and dividend yield/value strategies are leading inflows this year.
Is PMS better than mutual funds?
PMS offers customised portfolios and often outperforms benchmarks. However, it is suited only for HNIs who can take higher risk.
Can PMS provide regular income?
Yes, many PMS offer Systematic Withdrawal Plans (SWP), enabling investors to draw periodic income.
How do I select the right PMS manager?
Check track record, fee structure, risk management practices, and transparency before choosing. Consulting an expert like Dezerv, ICICI, helps avoid pitfalls.
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