Indian equity fund managers have managed to beat the benchmark indices hands down, despite the stock markets going through tumultuous times over the past decade and a half.

The first-ever ranking of fund managers, based on performance throughout their career, reveals that 90 per cent of the fund managers had a 50 per cent rate of outperformance versus the benchmark Nifty index. In other words, of the 32 equity fund managers ranked, 29 bettered the Nifty at least half the time.

Prashant Jain, chief investment officer of HDFC [Get Quote] Mutual Fund, tops the list, with a strike rate of 93.55 per cent. Jain, with nearly 13 years of experience, has raked in 23 per cent returns in HDFC Prudence fund (earlier called Centurion Prudence) since its inception in January 1994.

A close second was UTI Mutual's Sanjay Ramdas Dongre, with an average of 92.14 per cent, followed by DSP Merrill Lynch's Anup Maheshwari at 92.11 per cent. Sukumar Rajah and KN Siva Subramanian were the other two who made it to the top five, with a strike rate of over 80 per cent.

"That is an outstanding record. It is the reverse of the American market, where 90 per cent of the fund managers underperform the market," said Dhirendra Kumar, chief executive officer, Value Research.

"Apart from their skills, a key reason for the large-scale outperformance is that mutual funds are a tiny fraction of the whole market in our country, while in the US, mutual funds are the market itself, limiting the scope of fund managers bettering the market," added Kumar.

Thus, fund managers at home will have a field day for another decade or so till they become a sizeable part of the market.

The bad news is, even as the number of fund schemes and assets under management are growing, only a handful of experienced fund managers are still in the industry. Of the 32 equity managers, only 14 are currently with mutual funds; of the top 10 equity managers, six still remain.

The study was commissioned by Business Standard for its annual magazine on mutual funds. It was conducted by Delhi-based Value Research, the oldest firm tracking mutual funds in the country since the late 1980s.

The study ranked only equity managers with a minimum five-year track record and debt managers with at least two years of experience. The detailed methodology and results have been covered in the magazine, along with the profile of the five leading managers in the two categories.

While every one of the leading fund managers seemed to have a unique style of investing, a common thread was a bias towards growth. "Since most companies in India have still not attained their full potential, focusing on growth can bring in rich rewards," said Subramanian of Franklin Templeton.

Echoing this, UTI Mutual's Dongre said: "In developed countries, growth is scarce and hence, one needs to focus on what is available cheap to consistently deliver good returns. But in a developing country like ours, there is abundant growth, and an investment strategy focused on growth can deliver superior returns."

The track record of debt fund managers, however, was not as inspiring. Of the 20 fund managers ranked, only 11 beat their respective benchmarks over 20 per cent of the time.

Though the rate of outperformance in debt cannot be strictly compared to equities, because of the distinct nature and scope of the two markets, the debt numbers were also due to lack of viable benchmarks for every category of debt funds' asymmetry in valuation of debt securities, especially before the industry standards were strengthened a couple of years ago.