Nippon India ETF leads PSU bank ETFs with ₹4,078 crore AUM. Returns across top five funds track the index closely. Concentration risk in top holdings remains a factor for investors.
Alpha Score of 57 reflects moderate overall profile with strong momentum, weak value, strong quality. Based on 3 of 4 signals — score is capped at 90 until remaining data ingests.
Nippon India ETF Nifty PSU Bank BeES manages ₹4,078 crore in assets, making it the largest fund tracking the Nifty PSU Bank Index. The index itself holds 12 public sector banks listed on the National Stock Exchange. Over the past five years, the index delivered a 28.57% CAGR, turning a ₹1 lakh lump sum investment into ₹3.51 lakh. One-year returns stood at 18.81%, and three-year returns at 26.3% (₹2.02 lakh from ₹1 lakh). The 10-year CAGR is lower, at 12.6%, reflecting weaker performance in earlier years.
Among the top five ETFs by AUM, returns cluster tightly around the benchmark. Kotak Nifty PSU Bank ETF ranks second with ₹1,200 crore in assets, followed by DSP (₹850 crore), Mirae Asset (₹620 crore), and ICICI Prudential (₹410 crore). Over five years, Nippon India and Kotak ETFs posted CAGRs of 27.80% and 27.77%, respectively – within a percentage point of the index. One-year returns are similarly narrow: DSP returned 18.66%, Mirae Asset 18.56%, and ICICI Prudential 18.31%, all within half a point of the index's 18.81%. A ₹1 lakh investment in any of these funds a year ago would be worth about ₹1.18 lakh.
The near-identical performance means the ETF choice matters less for return expectations than for cost and execution. Investors should compare expense ratios and bid-ask spreads before picking a fund. The index itself carries concentration risk: the top three holdings – State Bank of India, Bank of Baroda, and Canara Bank – account for over 60% of the weight. A downturn in PSU banking stocks would hit the entire ETF category.
Past returns do not guarantee future performance. The 5-year CAGR of 28.57% came during a period of strong recovery in PSU bank earnings and NPA resolution. A repeat of that pace depends on credit growth, margin trends, and government policy. Data for this article comes from NSE and Value Research, as reported by Livemint.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.