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NFO Fundraising Hits 5-Year Low Amidst Market Woes
28 Jul
Summary
- New fund offer collections reached a five-year low in the June 2026 quarter.
- Fundraising in the quarter fell 73% year-on-year to ₹1,759 crore.
- Passive funds dominated new launches, with 26 out of 31 NFOs being index funds or ETFs.
New fund offer (NFO) collections by asset management companies (AMCs) continued their downward trend in the June 2026 quarter, reaching a five-year low. Collections fell by 73% year-on-year to ₹1,759 crore. This marks the sixth consecutive period of decline and a substantial 83.5% drop from the previous quarter.
The slowdown is attributed to weak equity market sentiment during the preceding quarter, where the BSE Sensex saw a significant dip. Although market sentiment improved in the June quarter, NFO fundraising did not recover.
Passive funds, such as index funds and ETFs, led the new launches in the June 2026 quarter. Out of 31 NFOs, 26 were passive funds, collectively gathering ₹1,024 crore.
Despite the weak NFO performance, SIP inflows remained robust, indicating sustained investor commitment. Experts anticipate further strengthening of SIP inflows in the coming years.
