DSP Black­rock Stops Fresh In­flows to Mi­cro­cap Fund

The Economic Times - - Companies: Pursuit Of Profit -

Mum­bai: DSP Black­rock Mi­cro­cap, one of the best-per­form­ing small-cap mu­tual funds, has de­cided to stop fresh in­flows af­ter Fe­bru­ary 17. Ear­lier in Au­gust 2016, the fund man­ager had re­stricted lump sum in­vest­ments to ₹ 1 lakh per per­son. The fund will now com­pletely stop ac­cept­ing fresh ap­pli­ca­tions, new sys­tem­atic in­vest­ment plans (SIPs) and new sys­tem­atic trans­fer plans (STPs) from in­vestors start­ing next week. A spokesper­son for DSP Black­rock Mu­tual Fund, de­clined to com­ment on the mat­ter.

The step comes in the wake of a sharp run-up in mid- and small-cap shares that has made it tough for the fund man­agers to iden­tify stocks. DSP Black­rock Mi­cro­cap Fund has given a re­turn of 42.83% in the last one year. “The mid-cap seg­ment has had a sharp run, mak­ing it tough for fund man­agers to iden­tify stocks which will de­liver re­turns,” says Manoj Nag­pal, MD, Ou­look Asia Cap­i­tal.

The man­date of the fund is to in­vest in com­pa­nies be­yond the top 300 com­pa­nies by mar­ket cap­i­tal­i­sa­tion. But, with their val­u­a­tions mov­ing up, there are fewer op­por­tu­ni­ties to in­vest. The fund’s as­sets have moved to ₹ 4,751 crore in Jan­uary 2017, from ₹ 348 crore three years ago.

This is the third time DSP Black­rock is putting in­vest­ment re­stric­tions on its Mi­cro­cap Fund. In Septem­ber 2014, it had put a re­stric­tion of ₹ 2 lakh for daily lump sum sub­scrip­tion and re­duced it to ₹ 1 lakh in Au­gust 2016. Last year, Mi­rae As­set Emerg­ing Bluechip too stopped ac­cept­ing lump sum sub­scrip­tions and Moti­lal Oswal PMS had stopped fresh in­flows in one of its prod­ucts.

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