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

Nippon India Banking and PSU Debt Fund Direct Growth Plan has a NAV of ₹22.9459 as of 10 Sep 2026 and manages ₹5,149 Cr. Its 1-year, 3-year and 5-year returns are 5.47%, 7.22% and 6.29% respectively, and the scheme is tagged as Medium Risk. Our view is that this is a steady debt option rather than a high-octane return seeker, with portfolio quality and rate-sensitive positioning shaping the experience more than sharp swings in the NAV path.

The fund has delivered a fairly even long-term pattern, with recent returns staying close to its own 3-year and 5-year range. That makes it more suitable for conservative investors who want debt allocation with moderate return expectations, while still accepting that short stretches can move around the benchmark.

Quick facts

Particular	Details
NAV	₹22.9459 as of 10 Sep 2026
AUM	₹5,149 Cr
Expense Ratio	0.38%
Launch Date	15 May 2015
Risk Category	Medium Risk
Benchmark	Nifty 50
Fund Category	Debt
Exit Load	No exit load after holding period
Fund Managers	Pranay Sinha, Vivek Sharma

The fund is managed by Pranay Sinha and Vivek Sharma.

Source data date: as of 10 Sep 2026

Performance

Period	Fund return	Benchmark return
1M	-0.05%	-4.06%
3M	1.56%	1.37%
1Y	5.47%	-7.31%
3Y	7.22%	6.07%
5Y	6.29%	5.91%

Recent performance has been mixed but controlled. The fund was slightly negative over 1 month, yet that short dip is modest compared with the benchmark’s sharper decline over the same period. Over 3 months, it has posted a small positive return and stayed ahead of the benchmark, which suggests the portfolio has remained reasonably resilient through near-term volatility.

The 1-year picture is more informative. The fund’s 5.47% return is clearly ahead of the benchmark’s -7.31%, so it has protected capital far better over that stretch. For debt investors, that gap matters because it points to a steadier ride than the benchmark’s broader swings.

Longer term, the 3-year and 5-year returns remain positive and close to one another, which indicates consistent compounding rather than a one-off spike. The 3-year return of 7.22% is above the benchmark, and the 5-year return of 6.29% also edges the benchmark’s 5.91%. Our view is that the fund has not been spectacular, but it has been dependable relative to the benchmark over the medium and longer horizon.

The time pattern also suggests that the fund tends to move within a narrow band instead of showing dramatic surges. That profile suits investors who value predictability more than aggressive upside, although they still need to accept that debt returns can soften in shorter windows.

Source data date: as of 10 Sep 2026

Should you BUY or HOLD Nippon India 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 Nippon India Banking and PSU Debt? Thinking of investing now?

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Peer comparison

Fund	1Y return	3Y return	5Y return
Nippon India Banking and PSU Debt Fund Direct Growth Plan	5.47%	7.22%	6.29%
TRUSTMF Banking & PSU Fund Direct Growth Plan	7.26%	7.52%	6.17%
Franklin India Banking & PSU Debt Fund Direct Growth Plan	6.69%	7.58%	6.45%
UTI Banking & PSU Debt Fund Direct Growth Plan	6.27%	7.46%	7.72%
Bandhan Banking and PSU Debt Fund Direct Growth Plan	6.03%	7.21%	6.25%
ICICI Pru Banking and PSU Debt Fund Direct Growth Plan	6%	7.38%	6.7%

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

On a 1-year view, this fund trails the stronger recent numbers seen in some peers, especially TRUSTMF and Franklin. Its 3-year return is competitive, but it sits a little below Franklin, UTI and ICICI Pru over the same period. The 5-year picture is more balanced: it remains in the same general band as most peers, although UTI has a notably higher 5-year return. The main takeaway is that the fund has been steady enough over longer stretches, but its recent pace is less assertive than the best peer results.

Source data date: as of 10 Sep 2026

Portfolio: where your money goes

Holding	Sector	Weight
Triparty Repo	Cash & Cash Equivalents and Net Assets	5.51%
Net Current Assets	Cash & Cash Equivalents and Net Assets	4.79%
7.59% National Housing Bank**	Corporate Debt	3.5%
7.48% National Bank for Agriculture and Rural Development	Corporate Debt	3.49%
7.68% National Bank for Agriculture and Rural Development**	Corporate Debt	3.39%
Small Industries Dev Bank of India**	Floating Rate Instruments	3.38%
7.77% REC Limited**	Corporate Debt	2.44%
7.34% Small Industries Dev Bank of India**	Corporate Debt	2.41%
7.8% Union Bank of India**	Corporate Debt	1.99%
7.7% Nuclear Power Corporation of India Limited**	Corporate Debt	1.95%

The top holding is Triparty Repo at 5.51%, so the largest single position is meaningful but not extreme. The next several holdings stay in a fairly tight range around 3% to 4%, which tells us the fund does not lean on one very large credit exposure to carry the portfolio.

The fall from the first holding to the tenth is moderate rather than abrupt. By the tenth row, the weight is 1.95%, so the portfolio is still carrying multiple position sizes that matter, but none of them dominate in a way that would suggest a highly concentrated book.

The top 10 holdings together account for approximately 32.85% of the portfolio, and the fund has 56 disclosed holdings in total. Our view is that this points to a reasonably diversified debt portfolio with a long tail of additional positions, while the displayed holdings still have enough weight to influence short-term behaviour.

To see all holdings, visit the Nippon India Banking and PSU Debt Fund Direct Growth Plan page

Source data date: as of 10 Sep 2026

Who should invest

This fund suits conservative investors who can accept Medium Risk in exchange for debt-style stability and moderate return potential. The 1-year, 3-year and 5-year numbers show a steadier profile rather than a sharp growth pattern, and the benchmark comparison suggests it has generally handled recent periods better than the index.

The cleaner fit is a medium- to long-term horizon, especially for investors looking to park money in a relatively structured debt allocation rather than chase higher upside. The key trade-off is that the fund may not deliver standout returns in strong risk-on phases, but it may provide a more controlled experience when markets are unsettled.

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 10 Sep 2026

Frequently asked questions

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

The current NAV is ₹22.9459 as of 10 Sep 2026.

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

The fund’s returns are 5.47% for 1 year, 7.22% for 3 years and 6.29% for 5 years.

How does the fund compare with its benchmark?

It has outpaced the benchmark over 1 year, 3 years and 5 years, and the gap is especially clear over the 1-year period.

How does it compare with other Banking and PSU debt funds on recent returns?

Its recent return is below the stronger peer figures at the 1-year horizon, while its 3-year and 5-year returns sit in a similar band to several peers, though some funds are ahead on one or both periods.

Who manages the fund?

The fund is managed by Pranay Sinha and Vivek Sharma.

What is the exit load and tax treatment?

There is no exit load after the holding period. For taxes, units held less than 1 year attract 20% short-term capital gains tax, while units held more than 1 year attract 12.5% long-term capital gains tax.

Bottom line

This fund has a steadier long-term shape than its short-term patch, with 1-year performance that is more subdued than the stronger peer returns but still ahead of the benchmark. The 3-year and 5-year numbers stay in a consistent band, which reinforces the view that this is a measured debt fund rather than a return-chasing one. The portfolio is spread across 56 holdings, with the largest positions still leaving room for diversification. That combination makes it a more suitable fit for investors who want controlled debt exposure and can accept moderate return variability.

Published on 11 September 2026 at 5:37 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.