AMFI data shows that NFOs contributed over 21% of the total equity inflows last fiscal.
Equity funds include pure equity schemes, balanced funds and ELSS.
Of the total equity inflows of Rs.1.18 lakh crore, net inflows through NFOs was Rs.24,597 crore in FY 2018-19.
Further, if we look at pure equity funds, NFOs accounted for 22% of the total flows. While the total inflows in pure equity schemes was Rs.99,087 crore in FY 2018-19, net flows mobilised through NFOs stood at Rs.21,360 crore.
Last fiscal, 77 equity NFOs were launched. Of these, 70 were pure equity schemes, 3 were balanced schemes and 4 ELSS. Of the 70 pure equity schemes, 47 were open-ended and 22 close-ended.
Ashutosh Bishnoi, MD and CEO, Mahindra MF said that many fund houses have either launched NFOs to expand their offerings arising out of introduction of scheme rationalisation or launched theme based NFOs. While the regular NFOs received moderate response, thematic NFOs got healthy response from investors, he added.
Going forward, some industry experts believe that the flow from NFOs in FY 2019-20 may see a sharp decline. Sunil Subramaniam, MD, Sundaram MF pointed out that fund houses would no longer launch close-ended schemes due to TER cap of 1.25%.
In FY 19, net inflows in close-ended equity NFOs were 25% of the total inflows in equity schemes.
