Best NPS fund manager in 2020 | NPS Tier-1

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Best NPS fund manager in 2020 for Tier-1

There are 7 fund houses that are offering funds under different categories for your NPS account. It is often a difficult task to choose the right fund manager for your NPS account while you open a NPS account.

While identifying the Best NPS fund manager for NPS Tier 1 account; Let’s look at the performance of all the fund’s houses in different categories as to how much NPS money they are managing(Asset under management – AUM), how

many people have preferred the fund house(Subscribers) and what are their 1 year, 3 years, 5 years and return since their inception.

Consider reading – What is tier 1 and tier 2 in NPS

Best NPS fund manager
Best NPS fund manager

 

Who are the different Fund managers in NPS?

As of May 2020, there are 7 different fund managers in NPS and they are :-

  1. Birla Sun Life Pension Management Ltd.
  2. HDFC Pension Management Co. Ltd.
  3. ICICI Pru. Pension Fund Mgmt Co. Ltd.
  4. Kotak Mahindra Pension Fund Ltd.
  5. LIC Pension Fund Ltd.
  6. SBI Pension Funds Pvt. Ltd
  7. UTI Retirement Solutions Ltd.

What are the different types of schemes in NPS?

There are 4 types of schemes under NPS:-

  1. Asset class E : “High return, High risk” (equity market instruments).
  2. Asset class G : “Low return, Low risk” fixed income instruments. The best example of this is central government bonds.
  3. Asset class C : “Medium return for credit risk” bearing fixed income instruments. Examples of these are bonds issued by firms.
  4. Asset class A : Alternate investments like – Investments in REITs, INVITs, etc.(Currently Asset class A is not being shown as an option in NPS website.

Who is the best NPS fund manager for Asset class E funds?

When you open a NPS account you have the choice to either go for auto allocation of Asset class or choose between different options. Mostly, people allocate a higher part of their NPS allocation to Asset class E as equity gives the most returns over the long term. This becomes a primary reason to choose the best Asset class E fund for your NPS account.

As per the data from NPS trust for May 2020; below are the performance details of various NPS schemes under Asset class E category

Pension FundAUM
(Rs Crs)
SubscribersReturns
1 Year
Returns
3 Years
Returns
5 Years
Returns
Inception
Birla Sun Life Pension Management Ltd.      59.1611,691-17.95%0.43%NA-0.11%
HDFC Pension Management Co. Ltd. 3,163.885,49,256-19.52%-0.33%3.06%8.94%
ICICI Pru. Pension Fund Mgmt Co. Ltd. 1,503.862,70,123-22.98%-2.18%1.55%7.90%
Kotak Mahindra Pension Fund Ltd.    319.7243,665-20.09%-1.65%2.28%7.37%
LIC Pension Fund Ltd.    719.681,59,110-24.24%-3.66%0.44%5.74%
SBI Pension Funds Pvt. Ltd 2,848.926,13,874-21.58%-1.49%2.18%6.58%
UTI Retirement Solutions Ltd.    425.2176,483-22.52%-2.00%3.99%7.89%
Benchmark Return as on 22/05/2020  -21.52%-0.79%2.22% 

Best performing NPS fund Asset class E funds

Looking at the above data HDFC Pension Management Co. Ltd. has given the 2nd lowest -ve returns in 1 year and 3 year period( the returns of all Asset class E are -ve because of the recent market crash). HDFC Pension Management Co. Ltd.  given the best returns since its inception.

Over 5 year period UTI Retirement Solutions Ltd. has given the best returns.

Highest AUM

Looking at AUM data HDFC Pension Management Co. Ltd has the highest AUM.

Highest subscriber base

SBI Pension Funds Pvt. Ltd  has the highest subscriber base among all the Asset E class funds.

 

Who is the best NPS fund manager for Asset class C funds?

Asset class C funds invest in bonds, with the recent problems with debt funds and concern over safety of debt funds investors are looking for the safety of debt funds over returns. From the below data from NPS trust, it appears that most of the debt funds have given similar returns.

Pension FundAUM
(Rs Crs)
SubscribersReturns
 1 Year
Returns
3 Years
Returns
5 Years
Returns
Inception
Birla Sun Life Pension Management Ltd.35.5311,53314.31%10.54%NA10.51%
HDFC Pension Management Co. Ltd.2149.355,43,23413.50%9.08%9.73%10.54%
ICICI Pru. Pension Fund Mgmt Co. Ltd.1177.472,69,10512.09%8.74%9.53%10.52%
Kotak Mahindra Pension Fund Ltd.243.7243,11611.26%8.05%9.22%10.30%
LIC Pension Fund Ltd.601.331,59,57314.00%8.83%9.50%10.41%
SBI Pension Funds Pvt. Ltd2320.966,12,41613.50%9.10%9.63%10.64%
UTI Retirement Solutions Ltd.316.7475,83913.11%8.60%9.35%9.54%
Benchmark Return as on 22/05/2020  13.73%8.69%9.43% 

Best performing NPS fund Asset class C funds

Looking at the above data Birla Sun Life Pension Management Ltd. has done excellently well in the 1 year and 3 year period and a close contender for since inception returns.

Over 5 years period HDFC Pension Management Co. Ltd. has performed the best. Returns since inception are best for SBI Pension Funds Pvt. Ltd  in the Asset class C funds.

Highest AUM

Looking at AUM data SBI Pension Funds Pvt. Ltd has the highest AUM and HDFC Pension Management Co. Ltd is close to the 2nd.

Highest subscriber base

SBI Pension Funds Pvt. Ltd has the highest subscriber base among all the Asset E class funds.

 

Who is the best NPS fund manager for Asset class G funds?

Asset class G funds invest in low-risk instruments like government bonds. These funds are like Gilt funds. From the below data from NPS trust, it appears that most of the debt funds have given similar returns.

Pension FundAUM
(Rs Crs)
SubscribersReturns
 1 Year
Returns
3 Years
Returns
5 Years
Returns
Inception
Birla Sun Life Pension Management Ltd.51.8611,28817.32%10.22%NA10.57%
HDFC Pension Management Co. Ltd.3485.695,39,92818.15%10.80%10.56%11.04%
ICICI Pru. Pension Fund Mgmt Co. Ltd.1754.112,65,16117.38%10.60%10.44%9.55%
Kotak Mahindra Pension Fund Ltd.381.5442,80517.49%10.58%10.61%9.49%
LIC Pension Fund Ltd.1071.901,62,46518.37%11.62%11.52%12.20%
SBI Pension Funds Pvt. Ltd4608.996,13,57717.48%10.65%10.59%10.31%
UTI Retirement Solutions Ltd.513.7872,74917.40%10.06%10.10%9.24%
Benchmark Return as on 22/05/2020  18.25%9.85%10.11% 

Best performing NPS fund Asset class G funds

Looking at the above data LIC Pension Fund Ltd. has done excellently well in the 1 year,3 years, 5 years and since inception.

Highest AUM

Looking at AUM data SBI Pension Funds Pvt. Ltd has the highest AUM

Highest subscriber base

SBI Pension Funds Pvt. Ltd has the highest subscriber base among all the Asset E class funds.

 

Who is the best NPS fund manager for Asset class A funds?

Asset class A funds invest in alternate investment funds like REITs,Invits etc. Currently, this scheme is not shown as one of the investment options and the AUMs shown below are for the subscribers who opted for it when the scheme was available for selection. From the below data from NPS trust, it appears that most of the debt funds have given similar returns.

Pension FundAUM
(Rs Crs)
SubscribersReturns
 1 Year
Returns
3 Years
Returns
5 Years
Returns
Inception
Birla Sun Life Pension Management Ltd.0.841,3325.21%6.52%NA6.52%
HDFC Pension Management Co. Ltd.19.9634,3055.96%7.86%NA7.59%
ICICI Pru. Pension Fund Mgmt Co. Ltd.5.7011,5332.02%5.69%NA5.84%
Kotak Mahindra Pension Fund Ltd.2.119,4769.07%8.07%NA7.59%
LIC Pension Fund Ltd.2.427,5614.94%7.21%NA6.96%
SBI Pension Funds Pvt. Ltd9.9024,65712.66%9.68%NA9.14%
UTI Retirement Solutions Ltd.2.103,6695.97%6.82%NA6.74%

 

Best performing NPS fund Asset class A funds

Looking at the above data SBI Pension Funds Pvt. Ltd. has done excellently well in the 1 year,3 years, and since inception.

Highest AUM

Looking at AUM data HDFC Pension Management Co. Ltd. has the highest AUM

Highest subscriber base

HDFC Pension Management Co. Ltd.  has the highest subscriber base among all the Asset E class funds.

FAQs

What are NPS tier 1 returns?

The NPS tier 1 equity funds have given around 7-10% returns since inception. This figure is at the lower side because of the recent market crash due to COVID-19.
The Debt funds of NPS have done better as compared to equity funds giving 10+% retutns since inception.

What are the different type of fund option available for NPS tier 1 account?

There are 4 types of schemes under NPS Tier 1 account:-
Asset class E : “High return, High risk” (equity market instruments).
Asset class G : “Low return, Low risk” fixed income instruments. The best example of this is central government bonds.
Asset class C : “Medium return for credit risk” bearing fixed income instruments. Examples of these are bonds issued by firms.
Asset class A : Alternate investments like – Investments in REITs, INVITs, etc.(Currently Asset class A is not being shown as an option in NPS website.

For each of the asset class there are multiple fund options available from different fund houses.

Is NPS Tier 1 investment better than the ELSS funds for tax savings?

NPS and ELSS are two different kinds of investments but at the same time offer tax-saving benefits.

NPS is a retirement product where in which your investment is locked until retirement. It is in a way good as you commit to long term investments. If you select equity option for NOS Tier 1 investments then your investments in NPS will give excellent returns.

ELSS funds are locked for 3 years but you are free to withdraw it after 3 years this provides you liquidity which is missing with NPS. If you withdraw your ELSS investments after 3 years then depending on the market condition your investment may give you excellent or mediocre returns!


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