With a lumpsum you invest a big sum all at once — say ₹5 lakh from a bonus, inheritance or maturing FD — instead of drip-feeding it monthly. The full amount starts working, and compounding, from day one.
In a steadily rising market, a lumpsum often beats a SIP because more money is invested for longer. The risk is timing: invest just before a market fall and you sit on losses until it recovers.
For example, ₹5 lakh invested as a lumpsum at 12% grows to about ₹15.5 lakh in 10 years. Many investors compromise by staggering a large sum over several months to reduce timing risk while still deploying it fairly quickly.