3 weeks ago
Bandhan Small Cap Fund lags peers despite strong 3-year record
This story is about a piggy bank that invests in small companies.
The piggy bank is called the Bandhan Small Cap Fund.
For a long time, it made lots of money for people.
Over three years, it grew their money by about 25 percent every year.
But lately, it has not done as well as other similar piggy banks.
In the last three months, it grew 6.71 percent while others grew 8.80 percent.
Small company investments go up and down like a rollercoaster.
One year it went up 52 percent, and another year it went down 6 percent.
An expert says you should not worry too much about short dips.
Instead, think about how long you can keep your money invested and how much risk you can handle.
Bandhan Small Cap Fund returned 6.71% over three months, below the small-cap category average of 8.80%.
Its one-year return of 8.05% also trailed the category average of 8.60%, while six-month returns lagged by over 2 percentage points.
Long-term performance remains strong: 3-year annualised return of 25.35% vs 16% category average, and 5-year return of 18.08% vs 15.48%.
Yearly returns were volatile, ranging from 53.60% in 2023 and 43.12% in 2024 to losses of 6.13% in 2022 and 1.13% in 2025.
Experts attribute outperformance to stock selection (+13.05%), with financial services the biggest contributor; the fund held Rs 28,466 crore in assets as of June 2026.
- Who
- Bandhan Small Cap Fund, its investors, and analyst Rajani who offered guidance
- What
- The fund's recent returns lagged small-cap category averages while its 3-year and 5-year returns outperformed peers
- Where
- India
- When
- Return data covers periods up to five years, with portfolio holdings reported as of June 2026
- Why
- Short-term underperformance reflects small-cap volatility, and experts say investors should judge the fund on risk, investment horizon and consistency rather than recent returns
Key facts
- 3-month return
- 6.71% vs category average 8.80%
- 6-month return
- 13.61% vs category average 15.92%
- 1-year return
- 8.05% vs category average 8.60%
- 3-year annualised return
- 25.35% vs category average 16.00%
- 5-year return
- 18.08% vs category average 15.48%
- Assets under management (June 2026)
- Rs 28,466 crore
- Equity and small-cap allocation
- 91.82% equities; 72.34% small caps, 13.25% mid caps, 6.12% large caps
- Largest sector exposure
- Finance at 13.30% vs category 8.12%
Quotes
Rajani
Fund adviser
“Investors should not use past returns as the sole basis for investing.”
businesstoday.in










