It received mixed to positive reviews from critics and was commercially successful, grossing over ₹66 crore worldwide.

When Bangarraju returns to Yamlok,[N 1] he is told that he has been shifted to Swarga due to the good deeds that he has done during his time back on earth.

They then see Bangarraju all grown up and that he has become the same man that his grandfather was, and at the same time Naga Lakshmi is trying to become the village Sarpanch after her father.

Meanwhile, Ramesh encounters a problem with the lands of a friend and Bangarraju helps him and fights off ruthless henchmen.

Following the success of Soggade Chinni Nayana in 2016 and the accompanying popularity of Bangarraju's character, Nagarjuna announced the film's sequel with Kurasala returning as the director.

Kurasala planned to cast Nagarjuna's second son Akhil Akkineni in the film, but did not materialize due to scheduling conflicts.

[11][12] Bangarraju's production was supposed to begin some time after Soggade Chinni Nayana but was postponed due to several reasons.

[22] Writing for Cinema Express, Murali Krishna CH called it a "perfect follow-up for its predecessor, Soggade Chinni Nayana."

"The film is peppered with hilarious one-liners, and Kalyan Krishna perfectly captures the portrait and vibe of a coastal village, complete with characters that are rooted in the setting," he added.

[23] Anji Shetty of Sakshi stated that Nagarjuna and Chaitanya's performance is the core strength of the film with a particular praise for the climax sequence.

[24] The Times of India critic Neeshita Nyapati opined that Bangarraju was an "old wine in a new bottle," and had nothing fresh to offer.

"[25] Calling Bangarraju a "passable festive entertainer," Sangeetha Devi Dundoo of The Hindu felt that the sequel banked heavily on Nagarjuna and Chaitanya but barely skimmed the surface of the supernatural revenge family drama story.

[32] During a promotional event of the film in January 2022, Nagarjuna, answering a question posed by a journalist, asserted a possibility of a sequel to Bangarraju [33] of Soggade Chinni Nayana 2016 movie.