Kotak Banking and PSU Debt Fund Direct Growth Review 2026: NAV, Returns, Portfolio & Should You Invest?
- September 10, 2026
- Posted by: Chaitanya Auti
- Category: Mutual Funds
Kotak Banking and PSU Debt Fund Direct Growth Plan has a NAV of ₹72.9014 as of 09 Sep 2026 and scheme AUM of ₹4,936 Cr. Its 1-year, 3-year and 5-year returns are 5.87%, 7.46% and 6.51% respectively, and the scheme is in the Medium Risk category.
Our view is that this is a debt fund for investors who want a relatively stable allocation with some return consistency rather than sharp upside. The portfolio is built around banking, PSU and corporate debt exposure, so the fund may suit conservative investors with a medium horizon who can accept moderate rate sensitivity.
Quick facts
| Particular | Details |
|---|---|
| NAV | ₹72.9014 as of 09 Sep 2026 |
| AUM | ₹4,936 Cr |
| Expense Ratio | 0.4% |
| Launch Date | 01 Jan 2013 |
| Min SIP | ₹100 |
| Risk Category | Medium Risk |
| Benchmark | Nifty 50 |
| Fund Category | Debt |
| Exit Load | No exit load after holding period |
| Fund Managers | Deepak Agrawal, Dharmesh Thakar |
The fund is managed by Deepak Agrawal and Dharmesh Thakar.
Source data date: as of 09 Sep 2026
Performance
| Period | Fund return | Benchmark return |
|---|---|---|
| 1M | -0.03% | -4.69% |
| 3M | 1.38% | 0.93% |
| 1Y | 5.87% | -7.16% |
| 3Y | 7.46% | 6% |
| 5Y | 6.51% | 5.87% |
The recent pattern has been steadier than the benchmark, especially over the past month and year. The fund was close to flat over 1 month while the benchmark declined more sharply, which suggests better short-term resilience.
Over 3 years and 5 years, the fund has stayed in a modestly positive compounding range. The 3-year return of 7.46% is ahead of the benchmark’s 6%, while the 5-year return of 6.51% is also ahead of the benchmark’s 5.87%.
The 1-year figure is also important because it shows the fund held up far better than the benchmark during a weaker market backdrop for the index. That gap tells us the fund’s debt-oriented positioning has delivered a more controlled path than an equity benchmark would normally offer. The recent 3-month reading is positive as well, so the latest trend has not broken away from the longer-term picture.
Source data date: as of 09 Sep 2026
Should you BUY or HOLD Kotak Banking and PSU Debt?
A fund’s past returns alone don’t tell you whether you should buy it today or continue holding it.
The right decision depends on factors such as your current allocation, purchase price, risk profile, investment horizon and the role this fund plays in your overall portfolio.
Already holding Kotak Banking and PSU Debt? Thinking of investing now?
Peer comparison
| Fund | 1Y return | 3Y return | 5Y return |
|---|---|---|---|
| Kotak Banking and PSU Debt Fund Direct Growth Plan | 5.87% | 7.46% | 6.51% |
| TRUSTMF Banking & PSU Fund Direct Growth Plan | 7.26% | 7.52% | 6.17% |
| Franklin India Banking & PSU Debt Fund Direct Growth Plan | 6.68% | 7.58% | 6.45% |
| UTI Banking & PSU Debt Fund Direct Growth Plan | 6.3% | 7.47% | 7.72% |
| Bandhan Banking and PSU Debt Fund Direct Growth Plan | 6.05% | 7.22% | 6.26% |
| ICICI Pru Banking and PSU Debt Fund Direct Growth Plan | 6.01% | 7.39% | 6.71% |
This assessment is prepared by Uniapps Investment Adviser Pvt. Ltd. under SEBI Registered Investment Adviser registration INA000017639.
The fund’s 1-year return is below the stronger peer readings in this set, but its 3-year result is broadly in line with the group and its 5-year return is competitive. That mix suggests the fund has not led on shorter horizons, yet its longer-term compounding still sits in a similar band to several banking-and-PSU debt peers.
What stands out is the difference between the 1-year and longer-window story. Some peers have better recent numbers, but the gap narrows when we look at 3-year and 5-year performance, which makes this more of a steady long-term income-oriented option than a recent momentum play.
Source data date: as of 09 Sep 2026
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Portfolio: where your money goes
| Holding | Sector | Weight |
|---|---|---|
| 7.6% Power Finance Corporation Ltd.(^)** | Corporate Debt | 6.67% |
| Triparty Repo | Cash & Cash Equivalents and Net Assets | 4.1% |
| 7.37% National Bank for Financing Infrastructure and Development** | Corporate Debt | 4.02% |
| 7.7% Power Grid Corporation of India Ltd.** | Corporate Debt | 3.26% |
| Net Current Assets/(Liabilities) | Cash & Cash Equivalents and Net Assets | 3.23% |
| 8.55% HDFC Bank Ltd.** | Corporate Debt | 3.09% |
| Canara Bank** | Certificate of Deposit | 2.95% |
| Union Bank of India** | Certificate of Deposit | 2.95% |
| 6.8% State Bank of India.** | Corporate Debt | 2.87% |
| 7.36% Indian Oil Corporation Ltd.** | Corporate Debt | 2.84% |
The largest holding, 7.6% Power Finance Corporation Ltd.(^)**, carries 6.67% of the portfolio, so no single position dominates outright. Weight then steps down fairly quickly through the next few holdings, which may help keep issuer-specific swings in check.
The top 10 holdings together account for approximately 35.98% of the portfolio, which means the disclosed sleeve is spread across a fairly long tail of other positions. With 54 holdings disclosed, the fund appears to use diversification across debt instruments rather than leaning on only a handful of names.
That structure could matter in two ways. First, the mix of corporate debt, certificates of deposit and cash-like positions may soften the impact of any one credit event. Second, the presence of multiple positions in the 2.8% to 4.1% range suggests the portfolio is not concentrated only in the very largest holdings, even though the leading names still have visible influence.
To see all holdings, visit the Kotak Banking and PSU Debt Fund Direct Growth Plan page
Source data date: as of 09 Sep 2026
Who should invest
This fund looks suitable for investors who are comfortable with Medium Risk and want a debt-oriented allocation with a reasonable holding horizon. The 1-year return is steadier than the benchmark, while the 3-year and 5-year figures show it can compound at a moderate pace over time.
The main trade-off is that the fund may not deliver the kind of upside an equity strategy can offer, but it also avoids that level of volatility. Investors who want a more controlled return profile, with portfolio exposure centred on banking and PSU debt, may find the overall fit more relevant than those looking for aggressive capital growth.
Tax and exit load
| Holding period | Tax rate | Description |
|---|---|---|
| Units held less than 1 year | 20% | Short-term capital gains tax |
| Units held more than 1 year | 12.5% | Long-term capital gains tax |
Exit load: No exit load after holding period.
Source data date: as of 09 Sep 2026
Frequently asked questions
What is the current NAV of Kotak Banking and PSU Debt Fund Direct Growth Plan?
Its NAV is ₹72.9014 as of 09 Sep 2026.
What are the fund’s 1-year, 3-year and 5-year returns?
The fund’s returns are 5.87% for 1 year, 7.46% for 3 years and 6.51% for 5 years.
How does this fund compare with the benchmark?
It has outpaced the benchmark across 1 month, 3 months, 1 year, 3 years and 5 years. The 1-year gap is especially wide because the fund returned 5.87% while the benchmark was at -7.16%.
How does the fund compare with the peer funds shown here?
Its 1-year return is lower than some peers in this set, but its 3-year and 5-year numbers remain competitive. That makes the long-term comparison more balanced than the short-term one.
What is the minimum SIP amount?
The minimum SIP amount is ₹100.
Who manages the fund and what is the exit load?
The fund is managed by Deepak Agrawal and Dharmesh Thakar. There is no exit load after the holding period.
Bottom line
Kotak Banking and PSU Debt Fund Direct Growth Plan has shown a steadier return pattern than the benchmark, especially over the recent one-year window, while its 3-year and 5-year returns remain in a moderate compounding band. In the peer set, the short-term picture is mixed, but the longer-term numbers stay broadly competitive. The portfolio is diversified across 54 disclosed holdings, with the largest position carrying only a mid-single-digit weight. That combination makes the fund more relevant for investors seeking a controlled debt allocation than for those chasing faster upside.
Published on 10 September 2026 at 11:37 AM IST
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RIA disclosure
Mutual fund investments are subject to market risks. Read all scheme-related documents carefully before investing. This review is prepared by Uniapps Investment Adviser Pvt. Ltd. (earlier known as Uniapps Global Research Pvt. Ltd.) under SEBI Registered Investment Adviser registration INA000017639 for general informational purposes and is not personalized investment advice.