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Top 5 Best Long Term Bond Funds 2025

Updated on June 28, 2025 , 13287 views

Looking for the best long term bond funds? These are funds for investors who are looking for mid to long term Investment plan, typically for 3-5 years. Long term bond funds mainly invest in G-secs and corporate Bonds that have medium to long maturity period.

Long-term-bond-funds

These funds are sensitive to interest rate changes and can be more volatile compared to other debt categories.

Interest Rates & Price in Long Term Bonds

Interest rates & prices of the debt securities have an inverse relationship, that means they move in opposite directions. For example, a falling interest rate is good for bond funds. During the interest rate falls, the bond prices go up and this boost NAVs of the Debt fund schemes.

As a decrease in the interest rates causes a rise in the price of long-term securities, it is advisable to invest in long term debt funds when the interest rates are expected to ease down. Investors who want to invest for a longer duration (i.e., 3 years & above), and can take some level of risk, should ideally invest in this scheme.

Moreover, investors who are comfortable with fluctuating interest rates in the Market can go ahead with these investments. Here are the top 10 best long term bond funds for 2025.

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Top 5 Best Long Term Bond Funds 2025

FundNAVNet Assets (Cr)Min InvestmentMin SIP Investment3 MO (%)6 MO (%)1 YR (%)3 YR (%)2024 (%)Debt Yield (YTM)Mod. DurationEff. Maturity
ICICI Prudential Long Term Bond Fund Growth ₹90.186
↑ 0.12
₹1,230 5,000 1,000 1.44.69.58.610.16.66%7Y 2M 19D18Y 9M 7D
IDFC Bond Fund Long Term Plan Growth ₹64.6049
↑ 0.13
₹488 5,000 1,000 0.62.86.36.57.96.77%6Y 8M 16D15Y 4M 6D
HDFC Income Fund Growth ₹58.3707
↑ 0.07
₹950 5,000 300 1.84.58.77.796.57%6Y 8M 8D11Y 11M 8D
Nippon India Income Fund Growth ₹89.695
↑ 0.13
₹426 5,000 100 1.23.97.97.98.16.8%6Y 6M 29D14Y 10M 10D
SBI Magnum Income Fund Growth ₹70.8616
↑ 0.10
₹1,983 5,000 500 24.48.57.98.16.9%6Y 5M 26D10Y 11M 16D
Note: Returns up to 1 year are on absolute basis & more than 1 year are on CAGR basis. as on 1 Jul 25

1. ICICI Prudential Long Term Bond Fund

(Erstwhile ICICI Prudential Income Plan)

To generate income through investments in a range of debt and money market instruments of various maturities with a view to maximising income while maintaining the optimum balance of yield, safety and liquidity.

ICICI Prudential Long Term Bond Fund is a Debt - Longterm Bond fund was launched on 9 Jul 98. It is a fund with Moderate risk and has given a CAGR/Annualized return of 8.5% since its launch.  Ranked 12 in Longterm Bond category.  Return for 2024 was 10.1% , 2023 was 6.8% and 2022 was 1.3% .

Below is the key information for ICICI Prudential Long Term Bond Fund

ICICI Prudential Long Term Bond Fund
Growth
Launch Date 9 Jul 98
NAV (01 Jul 25) ₹90.186 ↑ 0.12   (0.14 %)
Net Assets (Cr) ₹1,230 on 31 May 25
Category Debt - Longterm Bond
AMC ICICI Prudential Asset Management Company Limited
Rating
Risk Moderate
Expense Ratio 1.97
Sharpe Ratio 1.65
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load NIL
Yield to Maturity 6.66%
Effective Maturity 18 Years 9 Months 7 Days
Modified Duration 7 Years 2 Months 19 Days

Growth of 10,000 investment over the years.

DateValue
30 Jun 20₹10,000
30 Jun 21₹10,246
30 Jun 22₹10,103
30 Jun 23₹10,968
30 Jun 24₹11,817
30 Jun 25₹12,939

ICICI Prudential Long Term Bond Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for ICICI Prudential Long Term Bond Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 1 Jul 25

DurationReturns
1 Month -1.2%
3 Month 1.4%
6 Month 4.6%
1 Year 9.5%
3 Year 8.6%
5 Year 5.3%
10 Year
15 Year
Since launch 8.5%
Historical performance (Yearly) on absolute basis
YearReturns
2024 10.1%
2023 6.8%
2022 1.3%
2021 0.4%
2020 11%
2019 12.1%
2018 6.8%
2017 4.1%
2016 15.7%
2015 5.1%
Fund Manager information for ICICI Prudential Long Term Bond Fund
NameSinceTenure
Manish Banthia22 Jan 241.36 Yr.
Raunak Surana22 Jan 241.36 Yr.

Data below for ICICI Prudential Long Term Bond Fund as on 31 May 25

Asset Allocation
Asset ClassValue
Cash31.42%
Debt68.35%
Other0.23%
Debt Sector Allocation
SectorValue
Government50.5%
Cash Equivalent31.42%
Corporate17.85%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.34% Govt Stock 2064
Sovereign Bonds | -
33%₹401 Cr37,701,500
The Great Eastern Shipping Company Limited
Debentures | -
4%₹54 Cr536
HDFC Bank Limited
Debentures | -
4%₹52 Cr5,000
LIC Housing Finance Ltd
Debentures | -
4%₹52 Cr500
7.23% Maharashtra Sdl-04/09/2035
Sovereign Bonds | -
4%₹51 Cr4,960,700
6.9% Govt Stock 2065
Sovereign Bonds | -
4%₹50 Cr5,000,000
7.14% Maharashtra SDL 2039
Sovereign Bonds | -
3%₹42 Cr4,000,000
7.09% Govt Stock 2054
Sovereign Bonds | -
3%₹36 Cr3,500,000
LIC Housing Finance Ltd
Debentures | -
2%₹26 Cr2,500
7.09% Govt Stock 2074
Sovereign Bonds | -
2%₹26 Cr2,500,000

2. IDFC Bond Fund Long Term Plan

(Erstwhile IDFC Super Saver Income Fund - Investment Plan)

The primary investment objective of the scheme is to seek to generate stable returns with a low-risk strategy by creating a portfolio that is invested in good quality fixed income & Money Market securities. However, there can be no assurance that the investment objectives of the scheme will be realized.

IDFC Bond Fund Long Term Plan is a Debt - Longterm Bond fund was launched on 14 Jul 00. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.8% since its launch.  Return for 2024 was 7.9% , 2023 was 6% and 2022 was 0.6% .

Below is the key information for IDFC Bond Fund Long Term Plan

IDFC Bond Fund Long Term Plan
Growth
Launch Date 14 Jul 00
NAV (01 Jul 25) ₹64.6049 ↑ 0.13   (0.20 %)
Net Assets (Cr) ₹488 on 31 May 25
Category Debt - Longterm Bond
AMC IDFC Asset Management Company Limited
Rating Not Rated
Risk Moderate
Expense Ratio 1.98
Sharpe Ratio 0.61
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 1,000
Exit Load 0-365 Days (1%),365 Days and above(NIL)
Yield to Maturity 6.77%
Effective Maturity 15 Years 4 Months 6 Days
Modified Duration 6 Years 8 Months 16 Days

Growth of 10,000 investment over the years.

DateValue
30 Jun 20₹10,000
30 Jun 21₹10,261
30 Jun 22₹10,229
30 Jun 23₹10,892
30 Jun 24₹11,612
30 Jun 25₹12,348

IDFC Bond Fund Long Term Plan SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹194,235.
Net Profit of ₹14,235
Invest Now

Returns for IDFC Bond Fund Long Term Plan

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 1 Jul 25

DurationReturns
1 Month -1%
3 Month 0.6%
6 Month 2.8%
1 Year 6.3%
3 Year 6.5%
5 Year 4.3%
10 Year
15 Year
Since launch 7.8%
Historical performance (Yearly) on absolute basis
YearReturns
2024 7.9%
2023 6%
2022 0.6%
2021 1.2%
2020 11.8%
2019 10.4%
2018 6.6%
2017 3.1%
2016 12.9%
2015 5.9%
Fund Manager information for IDFC Bond Fund Long Term Plan
NameSinceTenure
Suyash Choudhary15 Oct 1014.72 Yr.
Brijesh Shah10 Jun 241.06 Yr.

Data below for IDFC Bond Fund Long Term Plan as on 31 May 25

Asset Allocation
Asset ClassValue
Cash18.05%
Debt81.66%
Other0.29%
Debt Sector Allocation
SectorValue
Government62.52%
Corporate30.88%
Cash Equivalent6.31%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.3% Govt Stock 2053
Sovereign Bonds | -
52%₹253 Cr24,500,000
↑ 500,000
National Bank For Agriculture And Rural Development
Debentures | -
10%₹50 Cr5,000,000
Tata Capital Limited
Debentures | -
9%₹43 Cr4,200,000
Bajaj Housing Finance Limited
Debentures | -
5%₹25 Cr2,500,000
Axis Bank Ltd.
Debentures | -
5%₹24 Cr2,500,000
↑ 2,500,000
Rec Limited
Debentures | -
0%₹2 Cr200,000
Corporate Debt Market Development Fund Class A2
Investment Fund | -
0%₹1 Cr1,254
6.79% Govt Stock 2027
Sovereign Bonds | -
0%₹1 Cr100,000
7.73% Govt Stock 2034
Sovereign Bonds | -
0%₹0 Cr37,500
Bank Of Baroda
Certificate of Deposit | -
5%₹24 Cr2,500,000
↑ 2,500,000

3. HDFC Income Fund

Aims to optimise returns while maintaining a balance of safety, yield and liquidity.

HDFC Income Fund is a Debt - Medium to Long term fund was launched on 11 Sep 00. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.4% since its launch.  Ranked 29 in Medium to Long term category.  Return for 2024 was 9% , 2023 was 6.1% and 2022 was 0.9% .

Below is the key information for HDFC Income Fund

HDFC Income Fund
Growth
Launch Date 11 Sep 00
NAV (01 Jul 25) ₹58.3707 ↑ 0.07   (0.11 %)
Net Assets (Cr) ₹950 on 15 Jun 25
Category Debt - Medium to Long term
AMC HDFC Asset Management Company Limited
Rating
Risk Moderate
Expense Ratio 1.53
Sharpe Ratio 1.55
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 300
Exit Load 0-1 Months (0.25%),1 Months and above(NIL)
Yield to Maturity 6.57%
Effective Maturity 11 Years 11 Months 8 Days
Modified Duration 6 Years 8 Months 8 Days

Growth of 10,000 investment over the years.

DateValue
30 Jun 20₹10,000
30 Jun 21₹10,392
30 Jun 22₹10,328
30 Jun 23₹11,054
30 Jun 24₹11,861
30 Jun 25₹12,894

HDFC Income Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for HDFC Income Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 1 Jul 25

DurationReturns
1 Month -0.9%
3 Month 1.8%
6 Month 4.5%
1 Year 8.7%
3 Year 7.7%
5 Year 5.2%
10 Year
15 Year
Since launch 7.4%
Historical performance (Yearly) on absolute basis
YearReturns
2024 9%
2023 6.1%
2022 0.9%
2021 2.1%
2020 9.3%
2019 8.7%
2018 3.6%
2017 1.3%
2016 14.5%
2015 5.3%
Fund Manager information for HDFC Income Fund
NameSinceTenure
Shobhit Mehrotra11 Sep 0717.81 Yr.
Dhruv Muchhal22 Jun 232.03 Yr.

Data below for HDFC Income Fund as on 15 Jun 25

Asset Allocation
Asset ClassValue
Cash7.76%
Equity0.44%
Debt91.55%
Other0.25%
Debt Sector Allocation
SectorValue
Government76.69%
Corporate14.85%
Cash Equivalent7.76%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.18% Govt Stock 2037
Sovereign Bonds | -
19%₹177 Cr17,000,000
7.41% Govt Stock 2036
Sovereign Bonds | -
11%₹106 Cr10,000,000
7.54% Govt Stock 2036
Sovereign Bonds | -
11%₹102 Cr9,500,000
7.23% Govt Stock 2039
Sovereign Bonds | -
8%₹79 Cr7,500,000
6.79% Govt Stock 2034
Sovereign Bonds | -
4%₹41 Cr4,000,000
Ntpc Limited
Debentures | -
3%₹26 Cr250
6.92% Govt Stock 2039
Sovereign Bonds | -
3%₹26 Cr2,500,000
7.59% Govt Stock 2031
Sovereign Bonds | -
3%₹26 Cr2,500,000
6.99% Govt Stock 2034
Sovereign Bonds | -
3%₹26 Cr2,500,000
Bajaj Housing Finance Limited
Debentures | -
3%₹25 Cr250

4. Nippon India Income Fund

The primary investment objective of the scheme is to generate optimal returns consistent with moderate levels of risk. This income may be complemented by capital appreciation of the portfolio. Accordingly, investments shall predominantly be made in Debt & Money Market Instruments.

Nippon India Income Fund is a Debt - Medium to Long term fund was launched on 1 Jan 98. It is a fund with Moderate risk and has given a CAGR/Annualized return of 8.3% since its launch.  Ranked 28 in Medium to Long term category.  Return for 2024 was 8.1% , 2023 was 6.8% and 2022 was 3.3% .

Below is the key information for Nippon India Income Fund

Nippon India Income Fund
Growth
Launch Date 1 Jan 98
NAV (01 Jul 25) ₹89.695 ↑ 0.13   (0.15 %)
Net Assets (Cr) ₹426 on 31 May 25
Category Debt - Medium to Long term
AMC Nippon Life Asset Management Ltd.
Rating
Risk Moderate
Expense Ratio 1.43
Sharpe Ratio 1.16
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 100
Exit Load 0-15 Days (0.25%),15 Days and above(NIL)
Yield to Maturity 6.8%
Effective Maturity 14 Years 10 Months 10 Days
Modified Duration 6 Years 6 Months 29 Days

Growth of 10,000 investment over the years.

DateValue
30 Jun 20₹10,000
30 Jun 21₹10,222
30 Jun 22₹10,269
30 Jun 23₹11,174
30 Jun 24₹11,943
30 Jun 25₹12,885

Nippon India Income Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹197,169.
Net Profit of ₹17,169
Invest Now

Returns for Nippon India Income Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 1 Jul 25

DurationReturns
1 Month -0.8%
3 Month 1.2%
6 Month 3.9%
1 Year 7.9%
3 Year 7.9%
5 Year 5.2%
10 Year
15 Year
Since launch 8.3%
Historical performance (Yearly) on absolute basis
YearReturns
2024 8.1%
2023 6.8%
2022 3.3%
2021 1.2%
2020 10.5%
2019 11.4%
2018 6.1%
2017 2.4%
2016 13.8%
2015 5.1%
Fund Manager information for Nippon India Income Fund
NameSinceTenure
Vivek Sharma1 Feb 205.33 Yr.
Kinjal Desai25 May 187.02 Yr.

Data below for Nippon India Income Fund as on 31 May 25

Asset Allocation
Asset ClassValue
Cash17.87%
Debt81.87%
Other0.26%
Debt Sector Allocation
SectorValue
Government70.02%
Corporate17.59%
Cash Equivalent12.13%
Credit Quality
RatingValue
AAA100%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
7.09% Govt Stock 2054
Sovereign Bonds | -
20%₹86 Cr8,500,000
7.3% Govt Stock 2053
Sovereign Bonds | -
19%₹83 Cr8,000,000
7.12% State Government Of Maharashtra 2036
Sovereign Bonds | -
10%₹41 Cr4,000,000
7.1% Govt Stock 2029
Sovereign Bonds | -
6%₹26 Cr2,500,000
Small Industries Development Bank Of India
Debentures | -
6%₹26 Cr2,500
National Bank For Agriculture And Rural Development
Debentures | -
6%₹25 Cr2,500
06.95 HR Sdl 2033
Sovereign Bonds | -
6%₹25 Cr2,500,000
↑ 2,500,000
6.79% Govt Stock 2034
Sovereign Bonds | -
2%₹10 Cr1,000,000
Power Finance Corporation Limited
Debentures | -
2%₹10 Cr100
Hdb Financial Services Limited
Debentures | -
2%₹10 Cr100

5. SBI Magnum Income Fund

To provide the investors an opportunity to earn, in accordance with their requirements, through capital gains or through regular dividends, returns that would be higher than the returns offered by comparable investment avenues through investment in debt & money market securities.

SBI Magnum Income Fund is a Debt - Medium to Long term fund was launched on 25 Nov 98. It is a fund with Moderate risk and has given a CAGR/Annualized return of 7.6% since its launch.  Ranked 6 in Medium to Long term category.  Return for 2024 was 8.1% , 2023 was 7.2% and 2022 was 3% .

Below is the key information for SBI Magnum Income Fund

SBI Magnum Income Fund
Growth
Launch Date 25 Nov 98
NAV (01 Jul 25) ₹70.8616 ↑ 0.10   (0.14 %)
Net Assets (Cr) ₹1,983 on 31 May 25
Category Debt - Medium to Long term
AMC SBI Funds Management Private Limited
Rating
Risk Moderate
Expense Ratio 1.46
Sharpe Ratio 1.59
Information Ratio 0
Alpha Ratio 0
Min Investment 5,000
Min SIP Investment 500
Exit Load 0-1 Years (1%),1 Years and above(NIL)
Yield to Maturity 6.9%
Effective Maturity 10 Years 11 Months 16 Days
Modified Duration 6 Years 5 Months 26 Days

Growth of 10,000 investment over the years.

DateValue
30 Jun 20₹10,000
30 Jun 21₹10,612
30 Jun 22₹10,760
30 Jun 23₹11,644
30 Jun 24₹12,456
30 Jun 25₹13,509

SBI Magnum Income Fund SIP Returns

   
My Monthly Investment:
Investment Tenure:
Years
Expected Annual Returns:
%
Total investment amount is ₹180,000
expected amount after 3 Years is ₹200,132.
Net Profit of ₹20,132
Invest Now

Returns for SBI Magnum Income Fund

Returns up to 1 year are on absolute basis & more than 1 year are on CAGR (Compound Annual Growth Rate) basis. as on 1 Jul 25

DurationReturns
1 Month -0.6%
3 Month 2%
6 Month 4.4%
1 Year 8.5%
3 Year 7.9%
5 Year 6.2%
10 Year
15 Year
Since launch 7.6%
Historical performance (Yearly) on absolute basis
YearReturns
2024 8.1%
2023 7.2%
2022 3%
2021 3.6%
2020 11.6%
2019 11.7%
2018 4.7%
2017 5.7%
2016 13.4%
2015 6%
Fund Manager information for SBI Magnum Income Fund
NameSinceTenure
Lokesh Mallya1 Dec 231.5 Yr.

Data below for SBI Magnum Income Fund as on 31 May 25

Asset Allocation
Asset ClassValue
Cash6.1%
Debt93.64%
Other0.26%
Debt Sector Allocation
SectorValue
Government68.4%
Corporate25.24%
Cash Equivalent6.1%
Credit Quality
RatingValue
AA25.06%
AAA74.94%
Top Securities Holdings / Portfolio
NameHoldingValueQuantity
6.79% Govt Stock 2034
Sovereign Bonds | -
39%₹767 Cr74,500,000
7.23% Govt Stock 2039
Sovereign Bonds | -
15%₹289 Cr27,500,000
7.3% Govt Stock 2053
Sovereign Bonds | -
9%₹171 Cr16,500,000
Torrent Power Limited
Debentures | -
4%₹79 Cr7,500
Renew Solar Energy (Jharkhand Five) Private Limited
Debentures | -
4%₹73 Cr7,500
Indostar Capital Finance Limited
Debentures | -
3%₹59 Cr5,900
Avanse Financial Services Limited
Debentures | -
3%₹55 Cr5,500
TATA Power Renewable Energy Limited
Debentures | -
3%₹51 Cr5,000
JM Financial Credit Solutions Limited
Debentures | -
3%₹51 Cr5,000
6.33% Gsec Mat - 05/05/2035
Sovereign Bonds | -
3%₹50 Cr5,000,000
↑ 5,000,000

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Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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GAURAV, posted on 3 Dec 18 3:04 AM

Good read to know about bond mutual funds

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