Roaring bull markets in equities have helped Pension Funds continue registering a sizzling performance with an average annual return of nearly 30 per cent from their equity investments, the latest PFRDA data showed.

This average annual return of 28.66 per cent in equities — as of February 16, 2024  —is more than triple the return of about 8.17 per cent seen in Corporate Bonds. 

It is also much higher than the 9.91 per cent in the government securities and about 11.60 per cent in Central and 11.56 per cent in State government schemes, data showed.

Over the last three-year period, the seven pension funds have generated an average return of 15.84 per cent. The average return from equities since inception of NPS stood at 13.45 per cent.

This strong show on equity returns comes at a time when several brokerage houses, including foreign ones such as Jefferies, are bullish about the economy’s growth prospects and foresee a sharp surge in Indian equities for the coming decade. 

Jefferies, in a note on Wednesday, said that India’s market capitalisation, which is currently the 5th largest globally (US $4.5trn), is expected to reach the $10 trillion mark by 2030. This foreign brokerage noted that India’s weight in global indices is still low at 1.6% (10th rank), which should change as market free float rises and some weight anomalies get sorted out.  

“Assuming market returns in line with the last 15-20 year history and new listings, India will become nearly a $10 trillion market by 2030 - impossible for large global investors to ignore”, it added.


Meanwhile, overall National Pension System (NPS) assets —including Atal Pension Yojana—grew robust 30 per cent year-on-year as of February 16 at ₹ 11.38 lakh crore.

Out of the total NPS AUM of ₹11.38 lakh crore, the total NPS monies parked in equities stood at about ₹2 lakh crore. 

On February 17 last year, NPS assets stood at ₹8.98 lakh crore.

PFRDA Chairman Deepak Mohanty had recently expressed confidence that NPS assets will touch  ₹ 12 lakh crore by the end of March 2024.


The robust growth in NPS assets was aided by strong show on the ‘Corporate’ and ‘all citizens model’ categories. So far this fiscal upto February 16, as many as 7.31 lakh new subscribers have joined NPS.

While the All Citizens Model saw 6.15 lakh new subscribers, the corporate model saw 1.16 lakh new subscribers. 

PFRDA hopes to take the new subscribers level to at least a million by the end of March 2024, although it has targeted the addition of 13 lakh new subscribers this fiscal year.

Last fiscal year, PFRDA had added a million new subscribers.

The total number of NPS and APY subscribers as of February 16 this year stood at 7.20 crore, up 16 per cent over 6.21 crore a year ago.

NPS took six years and six months to reach the milestone of ₹ 1 lakh crore AUM after its implementation in 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 2 years and ten months.


Equity markets in India  have been on a roll since 2023 —especially in the last four months since November 2023 —on the back of strong domestic inflows from retail investors. Foreign Portfolio Investors (FPI) returning to the markets in a big way as net buyers in 2023 also helped bolster the equity markets in December 2023 post the BJP’s victory in three major State  assembly elections. 

FPIs, however, have remained net sellers in equities this year.

Most analysts on the Street have a strong outlook for Indian equities in 2024, with many contending that the ongoing bull run still has some distance to go given the robust macroeconomic situation and expectations of likely continuity of the current dispensation in the upcoming 2024 general elections.

Sriram Iyer, CEO of HDFC Pension Management Company, said, “Historically, whenever equity markets have done well, one sees significant interest and participation in market-linked products - this, coupled with heightened awareness on NPS resulting from the awareness campaigns run by PFRDA and Industry participants, interest in NPS has certainly picked up. This is especially true for Salaried employees under the Corporate NPS architecture, which offers significant tax advantages (u/s 80 CCD (2))even if the individual has chosen the New tax regime.

NPS is one of the most ideal market-linked, low-cost, retirement corpus-creating tools available, offering a slew of benefits - the fact that it keeps you “locked in” to the journey of long-term wealth creation helps subscribers reap rich rewards if they stay the course. Early adopters of NPS have benefitted significantly over the last few years - these subscribers, in turn, have turned ambassadors for this product. While Fixed income products continue to lure subscribers, subscribers are starting to realise that such products, over the long term, will struggle to deliver inflation-beating returns”