Top 5 Gilt Mutual Funds to Consider Post-RBI Repo’s Rs 1 Lakh Crore OMO Purchase

Top 5 Gilt Mutual Funds: The Reserve Bank of India Governor Sanjay Malhotra announced a 25 basis points (bps) rate cut. Additionally, the RBI had akso announced open market operation (OMO) purchases of government securities worth Rs 1 trillion and a three-year dollar-rupee buy/sell swap.

"This is an unequivocally growth-supportive policy - anchored not only by rate cuts but also by liquidity infusion through OMOs and rupee-dollar swaps. However, despite the continued accommodative stance, one is not sure about further rate cuts. While the central bank has projected a benign inflation outlook for the first half of FY27, it has refrained from providing guidance for the second half, where the real risks could potentially re-emerge," stated N. ArunaGiri, CEO, TrustLine Holdings.

The OMO purchase and dollar-rupee swap will boost liquidity. The recent RBI MPC will ensure better opportunity for investors as well as bring macroeconomic stability, according to experts.

"For Indian investors, today's reaction, softer 10-year yields, Nifty above 26,000, and broad gains in financials, autos, NBFCs and realty - confirms this as a "Goldilocks" cut: supportive for growth without threatening macro stability. For portfolios, our bias from here: accumulate 5-7 year G-secs and maintain an overweight in well-capitalised PSU banks and quality retail-credit franchises as the core expression of this easing cycle," stated Karthick Jonagadla, Investment manager on smallcase and Founder of Quantace Research.

For investor who are interested in government securities investment can consider adding gilt mutual funds.

What is Gilt Mutual Funds?

According to Association of Mutual Funds in India (AMFI), gilt refers to the government securities. These are sovereign instruments which invest in securities with medium to long maturities ranging from three years to twenty years. A lock-in period of 10 years is only applicable to Gilt Funds with a constant duration of 10 years.

Top 5 Mutual Funds With Maximum Returns

Scheme Name	Benchmark	3-Year Return (%) – Regular	3-Year Return (%) – Direct	Benchmark Return (%)
UTI Gilt Fund with 10-Year Constant Duration	CRISIL 10 Year Gilt Index	7.55	8.07	7.89
ICICI Prudential Gilt Fund	Nifty All Duration G-Sec Index	7.53	8.09	7.78
Baroda BNP Paribas Gilt Fund	CRISIL Dynamic Gilt Index	7.35	7.71	7.85
Axis Gilt Fund	CRISIL Dynamic Gilt Index	7.16	7.62	7.85
Bandhan Gilt Fund	CRISIL Dynamic Gilt Index	7.02	7.68	7.85

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