NPS Equity Schemes Performance Report Jan 2026

Published on / By M. Pattabiraman Twitter: @pattufreefincal

Published: January 9, 2026 at 6:00 am

We publish a monthly National Pension Scheme Fund Screener to shortlist consistently performing NPS schemes. We discuss how the NPS equity schemes have performed using the Jan 2026 screener edition.

Please note: NPS funds are NOT passive schemes. They are actively managed. The top 200 stocks by market capitalisation on the NSE (Nifty 200 index) define their equity investment universe. So we compare the performance of the E (equity) schemes with Nifty 50 TRI and Nifty 200 TRI.

Rolling return outperformance consistency: the NPS scheme/fund returns are compared with category benchmark returns over every possible 3Y, 4Y, and 5Y period. The higher the consistency of outperformance, the better. Suppose 876 fund returns were compared with 876 benchmark returns, and the fund has beaten the benchmark 675 times. The consistency score will be 675/876, or ~77%.

The 14 schemes studied were

  1. ADITYA BIRLA SUNLIFE PENSION FUND SCHEME E – TIER I
  2. ADITYA BIRLA SUNLIFE PENSION FUND SCHEME E – TIER II
  3. HDFC PENSION MANAGEMENT COMPANY LIMITED SCHEME E – TIER I
  4. HDFC PENSION MANAGEMENT COMPANY LIMITED SCHEME E – TIER II
  5. ICICI PRUDENTIAL PENSION FUND SCHEME E – TIER I
  6. ICICI PRUDENTIAL PENSION FUND SCHEME E – TIER II
  7. KOTAK PENSION FUND SCHEME E – TIER I
  8. KOTAK PENSION FUND SCHEME E – TIER II
  9. LIC PENSION FUND SCHEME E – TIER I
  10. LIC PENSION FUND SCHEME E – TIER II
  11. SBI PENSION FUND SCHEME E – TIER I
  12. SBI PENSION FUND SCHEME E – TIER II
  13. UTI RETIREMENT SOLUTIONS PENSION FUND SCHEME E – TIER I
  14. UTI RETIREMENT SOLUTIONS SCHEME E – TIER II

5-year: NPS E Schemes vs Nifty 50 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: 2
  •  Schemes with Rolling return outperformance consistency 60% or more: 6
  •  Schemes with Rolling return outperformance consistency 50% or more: 9
  •  Schemes with Rolling return outperformance consistency 40% or more: 11

5-year: NPS E Schemes vs Nifty 200 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: Zero
  •  Schemes with Rolling return outperformance consistency 60% or more: Zero
  •  Schemes with Rolling return outperformance consistency 50% or more: Zero
  •  Schemes with Rolling return outperformance consistency 40% or more: 1

4-year: NPS E Schemes vs Nifty 50 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: Zero
  •  Schemes with Rolling return outperformance consistency 60% or more: 3
  •  Schemes with Rolling return outperformance consistency 50% or more: 8
  •  Schemes with Rolling return outperformance consistency 40% or more: 11

4-year: NPS E Schemes vs Nifty 200 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: Zero
  •  Schemes with Rolling return outperformance consistency 60% or more: Zero
  •  Schemes with Rolling return outperformance consistency 50% or more: Zero
  •  Schemes with Rolling return outperformance consistency 40% or more: Zero
  • Schemes with Rolling return outperformance consistency 30% or more: Four

3-year: NPS E Schemes vs Nifty 50 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: Zero
  •  Schemes with Rolling return outperformance consistency 60% or more: Zero
  •  Schemes with Rolling return outperformance consistency 50% or more: 6
  •  Schemes with Rolling return outperformance consistency 40% or more: 11
  • Schemes with Rolling return outperformance consistency 30% or more: 13

3-year: NPS E Schemes vs Nifty 200 TRI

  •  Schemes with Rolling return outperformance consistency 70% or more: Zero
  •  Schemes with Rolling return outperformance consistency 65% or more: Zero
  •  Schemes with Rolling return outperformance consistency 60% or more: Zero
  •  Schemes with Rolling return outperformance consistency 50% or more: 1
  •  Schemes with Rolling return outperformance consistency 40% or more: 2
  • Schemes with Rolling return outperformance consistency 30% or more: 5

Observations: This is rather unremarkable. Well, it is pathetic. Actively managed mutual funds have done better (perhaps they are paid better?)

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We have always maintained that NPS (for those it is mandatory, or for those who see themselves as only salaried with employer contributions) should be used as a debt scheme* with government and corporate bonds, with equity allocation made elsewhere in passive index funds (or active funds if you appreciate the risks). The data support our recommendation.

* Our monthly screener also uses bond and hybrid indices for comparing other NPS schemes. However, these are more indicative than definitive, like equity schemes.

Our overall recommendations remain the same. Use NPS as a debt fund only if you are going to be salaried for more than 15 years with the same or similar companies. You don’t need it to plan your retirement. It is best avoided regardless of tax benefits.

Stop getting enticed by tax benefits, rebalancing benefits, low cost, tax-free asset allocation changes, etc. The price to pay is poor performance. And some want to increase their equity allocation 100% via NPS. Please don’t!!