Axis Banking and PSU Debt Fund Direct Growth Review 2026: NAV, Returns, Portfolio & Should You Invest?

Axis Banking and PSU Debt Fund Direct Growth Plan has a NAV of ₹2,890.7153 as of 28 August 2026 and scheme AUM of ₹12,258 Cr. Its 1-year, 3-year and 5-year returns are 5.32%, 7.04% and 6.15%, and the scheme is tagged as Medium Risk. Our view is that it suits investors who want a debt fund with steady longer-term compounding and a portfolio built mainly around banking, PSU and sovereign paper rather than equity-like market exposure.

Performance has been relatively stable over longer periods, while the one-year stretch has been softer than the 3-year trend but still positive. The portfolio mix is dominated by corporate debt and certificate of deposit exposure, which supports a credit-led, income-oriented profile for conservative investors willing to accept medium risk.

Quick facts

Metric	Details
NAV	₹2,890.7153
AUM	₹12,258 Cr
Expense Ratio	0.34%
Launch Date	01 Jan 2013
Min SIP	₹1,000
Risk Category	Medium Risk
Benchmark	Nifty 50
Fund Category	Debt
Exit Load	No exit load after holding period
Fund Managers	Aditya Pagaria; Hardik Shah

The fund is managed by Aditya Pagaria and Hardik Shah.

Source data date: as of 28 Aug 2026

Performance

Period	Fund return	Benchmark return
1M	0.01%	-0.85%
3M	2.07%	3.39%
1Y	5.32%	-2.29%
3Y	7.04%	6.40%
5Y	6.15%	7.13%

The recent picture is mixed. Over 1 month, the fund was almost flat, which is better than the benchmark’s negative reading over the same period, but the 3-month return trails the benchmark’s pace. That suggests the last few months have been more uneven than the fund’s longer record.

The 1-year return is clearly stronger than the benchmark, which shows that the scheme has handled the recent environment better than NIFTY 50 on this measure. Even so, the fund’s 1-year performance is still modest for an income-oriented debt scheme, so we see it as a steady rather than a high-gear return profile.

Across 3 years, the fund has stayed ahead of the benchmark, and the 5-year return remains respectable even though it is below the benchmark’s longer-period figure. That split matters: the shorter-term numbers point to a softer phase, while the 3-year and 5-year record still indicates a pattern of controlled compounding rather than sharp swings. For debt investors, that kind of behaviour is usually more important than one-off monthly movement.

Source data date: as of 28 Aug 2026

Should you BUY or HOLD Axis 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.

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Peer comparison

Fund	1Y return	3Y return	5Y return
Axis Banking and PSU Debt Fund Direct Growth Plan	5.32%	7.04%	6.15%
TRUSTMF Banking & PSU Fund Direct Growth Plan	7.26%	7.52%	6.17%
Franklin India Banking & PSU Debt Fund Direct Growth Plan	6.62%	7.52%	6.43%
UTI Banking & PSU Debt Fund Direct Growth Plan	6.09%	7.41%	7.67%
Bandhan Banking and PSU Debt Fund Direct Growth Plan	5.95%	7.18%	6.23%
ICICI Pru Banking and PSU Debt Fund Direct Growth Plan	5.85%	7.34%	6.74%

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

On the latest 1-year number, this fund sits below the stronger peer readings in the set, with several funds showing a better short-term pace. The gap is smaller over 3 years, where the fund remains close to the peer cluster, but the 5-year figure is not as strong as the better long-run numbers in the comparison group.

That creates a clear split between short-term and longer-term comparisons. The fund looks competitive on a middle-horizon basis, yet the peer set shows more robust 1-year and 5-year outcomes in several cases. For an investor focused on return consistency within this style of debt fund, the fund’s appeal lies more in its stable mid-cycle profile than in leading the peer group on every horizon.

Source data date: as of 28 Aug 2026

Portfolio: where your money goes

Market-cap distribution

Market-cap bucket	Weight
Large cap	0%
Mid cap	0%
Small cap	0%
Other	100%

Sector mix

Sector	Weight	Top holdings
CORPORATE DEBT	67.82%	7.42% POWER FINANCE CORPORATION LIMITED (15/04/2028) ** — 3.14%; 7.59% REC LIMITED (31/05/2027) ** — 2.62%
CERTIFICATE OF DEPOSIT	14.63%	BANK OF BARODA (11/01/2027) ** — 1.08%; HDFC BANK LIMITED (24/02/2027) — 0.98%
GOVERNMENT SECURITIES	9.46%	7.18% GOVERNMENT OF INDIA (14/08/2033) — 1.47%; 6.79% GOVERNMENT OF INDIA (07/10/2034) — 1.43%
CASH & CASH EQUIVALENTS AND NET ASSETS	4.43%	CLEARING CORPORATION OF INDIA LTD — 2.39%; NET RECEIVABLES / (PAYABLES) — 1.94%
PTC & SECURITIZED DEBT	2.54%	SHIVSHAKTI SECURITISATION TRUST (28/09/2029) ** — 0.94%; SIDDHIVINAYAK SECURITISATION TRUST (28/09/2030) ** — 0.88%

The portfolio is entirely classified under other-cap exposure, so the scheme does not carry equity-style large-, mid- or small-cap allocation. That fits a debt strategy where the real risk comes from credit and interest-rate positioning rather than stock market participation.

Corporate debt at 67.82% is far larger than the next sector, certificate of deposit at 14.63%, so the mix is clearly concentrated in one main income sleeve. Government securities at 9.46% add a stabilising element, while cash and cash equivalents at 4.43% provide flexibility and PTC and securitised debt at 2.54% are a small satellite exposure.

Our view is that corporate debt is likely to have the greatest influence on how the fund behaves, simply because it dominates the portfolio. The two largest holdings inside that sleeve are also meaningful but not excessive at 3.14% and 2.62%, which suggests the portfolio is spread across several instruments even though the sector weight remains heavy.

Source data date: as of 28 Aug 2026

Who should invest

This fund may suit investors with a moderate tolerance for credit and rate-related movement who are comfortable with a Medium Risk debt scheme. The 3-year record is healthier than the 1-year reading, so the fund looks better suited to a patient holding period than to very short-term parking.

The benchmark comparison is mixed: the fund has recently done better over 1 year, but the 3-month and 5-year numbers are less supportive. That makes the main trade-off fairly clear: investors get a portfolio tilted toward banking, PSU and corporate debt, but they also need to accept that returns can move around and may not lead the benchmark on every horizon.

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 28 Aug 2026

Frequently asked questions

What is the current NAV of Axis Banking and PSU Debt Fund Direct Growth Plan?

The current NAV is ₹2,890.7153 as of 28 August 2026.

What are the 1-year, 3-year and 5-year returns?

The 1-year return is 5.32%, the 3-year return is 7.04% and the 5-year return is 6.15%.

How has the fund done against the benchmark?

It has outperformed the benchmark over 1 year and 3 years, while the benchmark is ahead over 3 months and 5 years.

How does it compare with the peer funds listed here?

Its 1-year return is below several peer funds in the comparison set, while its 3-year result stays close to the group and its 5-year number is also below some peers. The short-term and longer-term peer pictures are not the same.

What is the minimum SIP amount?

The minimum SIP amount is ₹1,000.

Who manages the fund and what is the exit load?

The fund is managed by Aditya Pagaria and Hardik Shah. There is no exit load after the holding period.

Bottom line

Axis Banking and PSU Debt Fund Direct Growth Plan shows a steadier longer-term profile than its shorter-term patch, with the 3-year record looking stronger than the latest 1-year and 3-month readings. Against peers, it is competitive on the mid-horizon measure but not the strongest on the longer and shorter comparisons we can see. The portfolio is heavily tilted to corporate debt, so its behaviour is likely to be shaped most by that sleeve. It may suit investors who want a debt-oriented allocation with medium risk and can stay invested long enough for the steadier compounding pattern to matter.

Published on 31 August 2026 at 5:23 PM 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.