Union Small Cap Fund Direct Growth Review 2026: NAV, Returns, Portfolio & Should You Invest?

Union Small Cap Fund Direct Growth Plan closed at ₹67.94 as of 03 Sep 2026, with scheme assets of ₹2,382 Cr. Its 1-year, 3-year and 5-year returns are 24.52%, 17.98% and 18.19%, and the scheme sits in the High Risk bucket.

Our view is that this is a small-cap fund with meaningful upside participation but also clear volatility. The return pattern is better suited to investors who can stay invested through uneven stretches and are comfortable with a portfolio that is still influenced by a relatively compact set of holdings.

Quick facts

The fund is managed by Pratik Dharmshi and Gaurav Chopra.

Source data date: as of 03 Sep 2026

Performance

Recent performance has been strong. The fund has outpaced its benchmark in every listed period, and the gap is especially wide over 1 year, where the fund return is far ahead of the benchmark’s 7.91% return. That kind of outperformance matters because it shows the scheme has been able to convert small-cap market conditions into stronger realised gains than the index over both short and medium horizons.

The path has not been smooth, though. The 1-year pattern shows a clear dip before a later recovery, which tells us the fund can move through sharp swings rather than rising in a straight line. For investors, that is typical of the small-cap segment, but it still matters because the drawdowns can test patience even when the final trailing number looks attractive.

Over longer horizons, the picture remains constructive. The 3-year and 5-year returns are both comfortably ahead of the benchmark, which suggests the fund has maintained an edge beyond a one-off recent burst. At the same time, the difference between the 3-year and 5-year returns is modest, so our reading is that long-term compounding has been steady rather than explosive.

Overall, recent momentum supports the longer-term track record rather than conflicting with it. The benchmark comparison also shows that the fund has done more than simply track the small-cap index; it has created additional return over multiple periods while still carrying the usual volatility of the segment.

Source data date: as of 03 Sep 2026

Peer comparison

This assessment is prepared by Uniapps Investment Adviser Pvt. Ltd. under SEBI Registered Investment Adviser registration INA000017639.

On recent numbers, the fund trails the strongest 1-year peers in this set, with TRUSTMF Small Cap Fund Direct Growth Plan and Bank of India Small Cap Fund Direct Growth Plan both ahead on the 1-year figure. Even so, its own 1-year return still sits close to the cluster of small-cap peers and remains well above the benchmark level.

The longer-term comparison is more balanced. The fund’s 3-year and 5-year returns are lower than Bank of India Small Cap Fund Direct Growth Plan and ITI Small Cap Fund Direct Growth Plan where those figures are available, but they are still meaningfully positive and above the benchmark. The short-term and longer-term pictures therefore tell slightly different stories: the recent run is respectable, while the multi-year record looks steadier than leading, but not the strongest, among the available peer figures.

Source data date: as of 03 Sep 2026

Portfolio: where your money goes

The top 10 holdings account for approximately 30.34% of the portfolio.

To see all holdings, visit the Union Small Cap Fund Direct Growth Plan page

The largest holding is just 3.73%, so no single position dominates the portfolio. The drop from the largest position to the tenth is fairly controlled, moving from 3.73% to 2.15%, which suggests the top slice is not stretched into a very heavy concentration.

At the same time, the combined weight of the top 10 holdings is only 30.34%, while the scheme has 66 disclosed holdings in total. That points to a portfolio that is spread across a fairly long tail of smaller positions rather than being driven by only a few names.

For investors, that mix may reduce reliance on any one holding, but it can also mean that returns depend on a broader set of stock-specific outcomes. In a small-cap fund, that balance can be useful, though it does not remove volatility.

Source data date: as of 03 Sep 2026

Who should invest

This fund is suited to investors who are comfortable with High Risk exposure and who can stay invested long enough to absorb uneven phases. The 1-year return is strong, but the 3-year and 5-year figures show that the journey is more moderate and volatile than the headline short-term number alone may suggest.

Our reading is that the fund fits an investor with a multi-year horizon who wants small-cap participation and is willing to accept sharper swings than a broader-market or large-cap strategy. The benchmark comparison is constructive, yet the peer set shows that stronger short-term and, in some cases, longer-term numbers are available elsewhere. The trade-off is clear: the fund offers return potential and diversification across many smaller positions, but it asks for patience through volatility.

Tax and exit load

Exit load: 1% on or before 15D, Nil after 15D.

There is no exit load after the holding period.

Source data date: as of 03 Sep 2026

Frequently asked questions

What is the current NAV of Union Small Cap Fund Direct Growth Plan?
Its current NAV is ₹67.94 as of 03 Sep 2026.

What are the 1-year, 3-year and 5-year returns?
The fund’s returns are 24.52% over 1 year, 17.98% over 3 years and 18.19% over 5 years.

How does it compare with the benchmark?
It has outperformed the Nifty Small Cap benchmark across 1M, 3M, 1Y, 3Y and 5Y periods. The margin is widest over 1 year.

How does it compare with peer small-cap funds?
Its 1-year return is below some peers in the comparison set, while its 3-year and 5-year returns are also behind some peers that have longer track records. Even so, the figures remain positive and above the benchmark.

What is the minimum SIP amount?
The minimum SIP amount is ₹500.

Who manages the fund and what is the exit load?
The fund is managed by Pratik Dharmshi and Gaurav Chopra. The exit load is 1% on or before 15D, and nil after 15D.

Bottom line

Union Small Cap Fund Direct Growth Plan shows a stronger recent run than its longer-term figures alone would suggest, while still keeping a constructive 3-year and 5-year record versus the benchmark. In the peer set, the latest 1-year number is respectable but not the strongest, and the longer-term numbers are also mixed against the better available peer records. The portfolio is spread across 66 holdings, with no single large position dominating. That makes it a fit for investors who want small-cap exposure, can accept High Risk volatility, and are comfortable with a diversified but still uneven return path.

Published on 4 September 2026 at 4:30 PM IST