Share Market: Market reform to put IPO-NFO line up, 66 companies in preparation for NFO

New Delhi| Due to tension and inflation between many countries, the decline in the stock market that has been going on since October has now stopped. BSE Sensex crosses 80,000 again. The losses incurred by investors are also being partially compensated. In the fall of the market, companies are preparing to launch IPOs, while mutual funds are ready to launch new fund offers (NFOs). Only three IPOs came in February while not a single one came in March. In April, Ather Energy is launching IPO with Rs 2,981 crore. In such a situation, more companies may enter the market in the coming months.

NAV of mutual fund schemes has started increasing
Due to improvement in the market, the net asset value i.e. NAV of mutual fund schemes has started increasing. Most schemes of mutual funds invest in equities. Therefore, when the market falls, the NAV i.e. return also starts decreasing. The rise in markets in April has brought back the returns of mutual funds. Investors who had gone into losses are being compensated. This is because the improvement in shares of the companies which had invested in equities is affecting the returns.

66 companies in preparation for NFOs
From January to March this year, 66 mutual fund companies have submitted draft with SEBI to bring NFOs. In the same period in 2024, the number was 56. In April, 12 fund houses have launched NFOs. It has fund houses ranging from SBI to Kotak, Bajaj and Edelweiss. Nippon India has launched two passive funds which will remain open till April 30. It has one Nifty 500 Low Volatility-50 Index while the other Nifty-500 Quality-50 Index Fund.

Analysts believe that investors should invest in less volatile stocks at this time. Both of Nippon’s funds are passive and follow a factor investing approach. Also, invest in good stocks, which present them as a hedge in the current volatile market environment. Both these NFOs, being passive index funds, provide many benefits. Funds are created to track an index, give diversification from a single unit, be transparent with low spending ratios. Low Volatility-50 Index Fund invests in 50 companies out of Nifty-500 index. Such funds choose the top-50 companies based on low volatility scores calculated using one year’s daily previous prices.