Axis Mutual Fund has announced the merger of Axis Nifty SDL September 2026 Debt Index Fund into Axis Banking & PSU Debt Fund, effective September 30, 2026. According to the fund house announcement, this merger will result in the complete dissolution of the Nifty SDL September 2026 Debt Index Fund, with all existing unitholders automatically becoming unitholders of the Axis Banking & PSU Debt Fund.
The fund house has provided an exit window for unitholders who do not wish to participate in the merger. As reported by Axis Mutual Fund, unitholders of the Nifty SDL September 2026 Debt Index Fund can exit or switch their investments without any exit load between August 31, 2026 and September 29, 2026. This window allows investors to transition their holdings to alternative funds or redeem their investments without penalty during this specified period.
The merger will have a direct impact on the unitholders of Axis Nifty SDL September 2026 Debt Index Fund, who will automatically become unitholders of the Axis Banking & PSU Debt Fund following the completion of the merger. According to the fund house announcement, this consolidation represents a strategic restructuring of the fund portfolio within the Axis Mutual Fund stable. The merger is part of a broader trend in the mutual fund industry where fund houses are streamlining their offerings to improve portfolio management and reduce operational complexity.
The Axis Floating Interest Rates Fund Direct-IDCW Quarterly currently trades at ₹1,343.90 with an AUM of ₹124.36 crore. The fund has delivered 1-year returns of 8.04% and 3-year returns of 8.37%, ranking first within its category for both periods. The fund maintains a modified duration of 4.63 years and average maturity of 9.53 years, with government-backed securities comprising 39.83% of the portfolio. The fund is managed by Aditya Pagaria since July 2021 and Hardik Shah since January 2022.
Investors in debt mutual funds face specific taxation rules based on their investment duration. For investments held less than 3 years, the entire gain is added to the investor's income and taxed as per applicable slab rates. For investments held more than 3 years, gains are taxed at 20% post-indexation benefits. Additionally, dividend income exceeding ₹5,000 annually is subject to 10% TDS deduction by the fund house. Investors should note that capital gains tax implications may arise when switching existing mutual fund investments, and any decisions should be taken after assessing the tax impact.
