Investor participation in IPO decreased, analysts estimate that investment in NFO will yield benefits

New Delhi| Investor participation in some issues has declined amid the rise of IPOs. Some IPOs have not received even double the subscription. Non-institutional investors (NIIs) and retail investors have also shown less interest. Niwa Bupa has received a mere 1.90 times subscription, with NII’s share being 0.70 per cent full. Akme Solar is filled with 1.02% of NII and 1.85 times the total. Swiggy has a NII share of 0.41 per cent and a total of 1.65 times.

Afcons has received only 1.77 times the subscription. In Godavari the NII put money for 0.93 per cent and it filled 1.87 times. On the other hand, mutual funds have started launching new fund offers i.e. NFO. In October, 6,078 crores have been raised from 29 schemes. Three NFOs have opened after the slowdown in IPOs. It has companies like Shriram Group, ICICI Prudential and Nippon. Analysts believe that mutual funds can provide NFO benefits in the long run.

Nippon

Nippon India Fund has launched two funds in the passive sector. These are of auto and reality theme. Auto Index Fund is a fund that will track Nifty Auto Index performance. Realty Index Fund will follow the Nifty Realty Index. These funds have benefits like low cost and diversification and transparency through a single unit. Nifty Auto Index TRI has given returns of 48.7% in one year and Nifty Realty Index TRI has given returns of 66% compound rate.

Shriram

The fund has launched several sector rotation funds. It is an open-ended scheme to invest in equities and related instruments. This is the first fund of its kind. Its strategy is to take advantage of opportunities in better performing sectors by reducing risk in underperforming sectors.

ICICI Prudential

This fund has launched Equity Minimum Variance NFO. It is an open ended equity scheme following the minimum volatility theme. Its objective is to achieve capital growth in the long run by reducing portfolio volatility and investing in equities and related instruments as compared to the scheme’s benchmark Nifty 50 TRI. The fund’s investment strategy focuses on large capital companies. Stocks with low volatility are given more weight. Its diversified portfolio helps reduce volatility.