DSP Blackrock Stops Fresh Inflows to Microcap Fund
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.