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Pension funds spike as one-year equity returns jump to 29 per cent: Report
This average annual return of 29.35 per cent in equities in the first week of February is more than triple the return of about 7.87 per cent seen in corporate bonds.
Gaining from the bullish momentum in the equities market over the past year, pension funds have recorded an average annual return of nearly 30 per cent from their equity investments, per the latest PFRDA data, reported Business Line .
This average annual return of 29.35 per cent in equities in the first week of February is more than triple the return of about 7.87 per cent seen in corporate bonds.
It is even higher than the 9.61 per cent in government securities, about 11.43 per cent in Central and 11.39 per cent in State government schemes, data showed.
Over the last three years, the seven pension funds have delivered an average return of 16.89 per cent. The average return from equities since the inception of NPS stood at 13.34 per cent.
Meanwhile, the overall National Pension System assets — including Atal Pension Yojana — grew by a robust 29 per cent on a y-o-y basis as of February 3 at ₹11.26-lakh crore.
Out of the total NPS AUM of ₹11.26- lakh crore, the total NPS monies parked in equities stood at about ₹2-lakh crore. In February last year, NPS assets stood at ₹8.73-lakh crore.
NPS assets will touch ₹12 lakh crore by the end of March 2024, PFRDA Chairman Deepak Mohanty had recently said.
Spike in subscribers
The robust growth in NPS assets was aided by strong showings on the ‘corporate’ and ‘all citizens model’ categories. So far, this fiscal up to February 4, as many as 6.7 lakh new subscribers have joined NPS.
While the all-citizens model saw 5.59 lakh new subscribers, the corporate model saw 1.11 lakh new subscribers. PFRDA is hopeful of taking the new subscribers’ level to at least a million by the end of March 2024 although it has targeted 13 lakh new subscribers this fiscal.
In the last 12 months as of February 3, as many as 8.42 lakh new subscribers were onboarded into NPS.
Last fiscal year PFRDA had added a million new subscribers. Of these 8.42 lakh new subscribers, as many as 5.82 lakh subscribers came in through the ‘all citizen model’ and the rest 2.59 lakh through the corporate model.
The total number of NPS and APY subscribers as of February 3 this year stood at 7.13 crore, up 16 per cent over 6.16 crore in a year ago.
NPS took six years and six months to reach the milestone of ₹1 lakh crore AUM after its implementation in the year 2009.
It then took 4 years and 11 months to further increase AUM to ₹5 lakh crore. NPS AUM had doubled to ₹10 lakh crore as of August 25 from ₹ 5 lakh crore in just two years and ten months.
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Business NewsMoneyPersonal FinancePension funds spike as one-year equity returns jump to 29 per cent: Report
First Published:9 Feb 2024, 03:07 PM IST
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