Despite the equity markets scaling new peaks in September, mutual funds (MFs) seem to have been hesitant in launching fresh new fund offerings (NFOs).
As a result, the amount mobilised by them has fallen as well. Three equity NFOs cumulatively collected around Rs 1,300 crore in September. As opposed to this, the previous month witnessed the same number of equity NFOs garnering around Rs 2,662 crore. This shows a 51% dip or of around Rs 1,362 crore.
?Considering the scorching growth in equity indices, there is a perceptible drop in equity funds? NFOs and their collections. This slowdown in equity NFO issuances is rather puzzling and may reflect the hesitance of retail investors in entering the markets during peak levels,? says Sameer Kamdar, country head, Mata Securities.
The three NFOs launched in September were JM Contra fund, which mobilised around Rs 850 crore, HSBC Dynamic Fund, which collected around Rs 450 crore, and Escorts Infrastructure Fund, which managed to mobilise a mere Rs 10 crore. However, the August NFOs ? Reliance Equity Advantage fund, UTI Lifestyle Fund and Lotus Growth Fund ? collected Rs 1,400 crore, Rs 1,000 crore and Rs 262 crore, respectively
Besides, even fixed maturity plans (FMPs) showed a flat growth with only 51 FMPs or interval funds being launched in September as against 58 in August. The yields on FMPs also came down marginally with 90-day FMPs declining to around 8.05%-8.10% in September against 8.35%-8.40% in August 2007.
?Most of the 90-day FMPs are witnessing a rollover and most of the existing ones are still witnessing good inflow of money,? says Dhirendra Kumar, CEO, Value Research.
There were 26 issuances of the 90-day FMPs, 19 of the 1-2 year FMPs, while 2 each of the 30-day, 180-day and 3-year FMPs, respectively.
