Asset management companies mobilised ₹17,805 crore through 67 new fund offerings (NFOs) in the September 2022 quarter, a 64% decline from the year-ago period due to expensive valuations and high volatility in equity markets, PTI reported, quoting Morningstar India data.
According to the report, 43 NFOs were issued between July and September 2021, raising a total of ₹49,283 crore.
However, sequentially, the performance was much better, the report said. The first quarter (April-June) of the current fiscal saw only four NFOs, garnering a total of ₹3,307 crore.
"Today, the market is trading at a higher level and is a bit expensive. As a result of that, investors are currently hesitant to enter the market. This is why, according to Manish P Hingar, founder of Fintoo, you may see less money mobilised in the current quarter.
Another factor could be high volatility in the equity markets, Abhishek Dev, CEO and co-founder of Epsilon Money Mart, said. Adding to that, he said, "Even though new funds launched were less in the quarter under review compared to the year-ago period, liquidity and appetite were better that time."
In the three months that ended in September 2022, as many as 67 NFOs were launched, compared to just four in the preceding quarter. The negligible launches were due to restrictions imposed by the Securities and Exchange Board of India (SEBI), the report said.
The highest number of schemes launched during the quarter under review were in the other schemes category (30), which included 17 other ETFs and 11 index funds. The other schemes collected ₹915 crore.
In addition, investors were attracted to debt funds, Morningstar India said, with AMCs launching 23 schemes to raise ₹6,432 crore and 10 equity funds were floated collecting ₹8,898 crore.
Within the equity segment, Flexicaps funds witnessed a lot of interest from asset management companies.
Last year, there were many multicap fund NFOs as this was a newly created category and many AMCs had this gap in their bouquet, the report concluded.
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