Nippon India Nifty Smallcap Fund analysis: Performance has shown inline with NIFTY Smallcap 250 with 39.7% since debut

Nippon India Nifty Smallcap Fund’s NAV & Mutual Fund Performance.

The Nippon India Nifty Smallcap 250 Index Fund aims to provide returns that closely correspond to the total returns of the securities represented by the Nifty Smallcap 250 Index, before expenses, subject to tracking errors. Launched on October 16, 2020, this scheme adopts a passive investment strategy designed to replicate the performance of the Nifty Smallcap 250 TRI. The fund invests in the same proportion as the index, focusing on long-term capital growth through equity investments in small-cap companies ranked 251–500 based on full market capitalization from the Nifty 500.

Nippon India Nifty Smallcap Fund – Growth Since Inception (2020)


Since its inception in October 2020, the Nippon India Nifty Smallcap 250 Index Fund has demonstrated impressive growth. The fund’s Net Asset Value (NAV) as of April 30, 2024, stood at ₹30.6987. Over this period, the fund has managed to deliver substantial returns, with an absolute return of 210.67% and an annualized return of 36.72%, outperforming many of its peers and benchmarks.

Nippon India Nifty Smallcap Fund – Returns

The fund showed remarkable performance across various timeframes, as illustrated by its CAGR (Compound Annual Growth Rate) percentages:

  • 1-Year CAGR: 66.39%
  • 3-Year CAGR: 28.68%
  • Since Inception: 37.28%

Comparatively, the benchmark Nifty Smallcap 250 TRI delivered slightly higher returns:

  • 1-Year CAGR: 68.94%
  • 3-Year CAGR: 30.66%
  • Since Inception: 39.70%

Nippon India Nifty Smallcap Fund – Recent Performance

As of May 31, 2024, the latest NAV for the fund was ₹30.2803. The fund has experienced slight fluctuations in the short-term

  • 1-week return of -1.50%
  • 1-month return of -1.31%.

Nippon India Nifty Smallcap Fund – Portfolio Composition

The fund’s portfolio is heavily skewed towards domestic equities, with 99.96% of its assets invested in stocks. 

The fund manager has maintained a high portfolio turnover ratio of 58.00%, significantly higher than the category average of 28.74%, indicating frequent adjustments to the holdings.

Sector Allocation

The top sectors in the fund’s portfolio include auto components, exchange platforms, household appliances, depositories, and aluminium. This diverse sector allocation helps mitigate risks associated with specific industries while capitalizing on growth opportunities in various market segments.

Nippon India Nifty Smallcap Fund – Key Holdings

The top 10 stocks in the portfolio, accounting for significant portions of the holdings, are:

  1. Exide Industries Ltd. – Auto components & equipment (1.34%)
  2. Multi Commodity Exchange Of India Ltd. – Exchange and data platform (1.32%)
  3. Crompton Greaves Consumer Electricals Ltd. – Household appliances (1.29%)
  4. Blue Star Ltd. – Household appliances (1.22%)
  5. Central Depository Services (India) Ltd. – Depositories and intermediaries (1.18%)
  6. National Aluminium Co. Ltd. – Aluminium (1.05%)

Nippon India Nifty Smallcap Fund – Risk Ratios

The fund’s risk ratios indicate a high level of volatility and superior risk-adjusted returns

  • Standard Deviation: 15.06 (Category Avg: 12.36)
  • Beta: 0.99 (Category Avg: 0.86)
  • Sharpe Ratio: 1.32 (Category Avg: 0.59)
  • Treynor’s Ratio: 0.20 (Category Avg: -0.21)
  • Jensen’s Alpha: -1.34 (Category Avg: -0.53)

The higher standard deviation and beta suggest that the fund is more volatile than its peers. However, the Sharpe and Treynor ratios indicate better risk-adjusted returns, reflecting the fund’s efficiency in generating returns relative to the risks taken.


The Nippon India Nifty Smallcap 250 Index Fund suits investors seeking long-term capital growth through investment in small-cap equities. The fund’s strategy of replicating the Nifty Smallcap 250 Index offers exposure to high-growth potential companies within the small-cap segment. Investors with a higher risk tolerance and a long-term investment horizon may find this fund particularly attractive, given its strong historical performance and risk-adjusted returns.

Disclaimer: The information provided in this article is for educational and informational purposes only. It should not be considered as investment advice or a recommendation to invest in any particular mutual fund or asset class. Past performance does not indicate future results, and investors should research and consult with a financial advisor before making investment decisions. Investing in mutual funds involves risks, including the possible loss of principal invested.