Puneet Sharma
The Indian economy has traversed multiple business cycles over the past 25 years. It began with the mild recession that followed the dotcom bust in the early 2000s, before entering an upcycle that lasted until the Global Financial Crisis of 2008. This was followed by a stimulus-driven rebound from 2009 to 2012, which eventually gave way to the volatility triggered by the taper tantrum in the mid-2010s. The 2016-2017 period witnessed a series of structural policy reforms – GST implementation, demonetisation, and the roll out of the Insolvency and Bankruptcy Code which was followed by associated transition pains between 2017 and 2019. The pandemic-induced contraction in 2020 was succeeded by a strong V-shaped recovery in 2021. The years 2022-2024 marked a phase of normalization marked by elevated inflation driven by supply chain disruptions and an extended period of loose global monetary policy. Now, the economy is seeing government capex and policy-led expansion, even as it continues to navigate significant global uncertainties and geopolitical headwinds.
The stock markets too, as a result, have seen ups and downs over the years, proving to be a wild ride for equity investors. 2026 and the years ahead will bring economic cycles of their own. Equity investors have to navigate these with tact and patience to create sustainable, long-term wealth. Business Cycle Mutual Funds which are designed to ride out different business cycles in a research-backed, disciplined way can be a smart way to do that. These funds do top-down research to identify lucrative themes and opportunities. They also move out of sectors and stocks set to underperform as a result of the cycle.
This is done continuously in a way that has potential to add to returns and reduce risk over time, making it particularly advantageous for retail investors who may not have the time, expertise, or resources to track and respond to economic cycles on their own.
ICICI Prudential Business Cycle Fund is one such option investors can consider.
Launched in January 2021, it has stood out for its consistent performance. As of November 30, 2025, it posted a one year CAGR of 13.41% and healthy CAGR of 21.66% over three years and 21.58% since inception, outperforming its benchmark by 4-7% across these periods.
(The writer is Mutual Fund Distributor, J&K)