The three top-performing funds launched in 2023-24

It rained NFOs (new fund offers) in the financial year just gone by. A staggering 176 new mutual funds - of which 114 are equity funds - were rolled out for investors, the highest in the last five years. In terms of inflows, these new funds pocketed a cool Rs 39,427 crore (as of February 2024) from investors, second only to FY2022. There was a massive appetite for thematic and multi-asset funds, with SBI Energy Opportunities Fund being a standout, raising an impressive Rs 6,547 crore during the launch period. But given our general stance against NFOs, for they have no history and track record, we wanted to check if these newbies have hit the market running. Granted, they are too young for an examination, but we decided to scan the performance of actively managed equity funds (excluding thematic funds as they have a limited number of stocks to choose from) with at least a three-month history. Of the 20 funds that fit our criteria, only three slotted in the top 25 per cent of top performers in their respective categories based on our classification: ITI Focused Equity Fund NJ Flexi Cap Fund Motilal Oswal Small Cap Fund Off to a good start These three actively managed equity funds find themselves in the top quartile of their respective categories Fund name Launch date Return since inception Category average Rank ITI Focused Equity Fund 19-Jun-2023 27.75 23.76 18/75 NJ Flexi Cap Fund 05-Sep-2023 30.65 15.44 2/78 Motilal Oswal Small Cap Fund 26-Dec-2023 2.24 0.05 6/35 Note: Returns as of March 26, 2024. The flexi-cap category encompasses both flexi and focused funds, as per VR classification. ITI Focused Equity , launched last June with a mandate of investing in up to 30 stocks only, has delivered 27.75 per cent since its inception, compared to its average peer's 23.76 per cent. Much of its success can be attributed to its current affinity for the energy sector, wherein its recent PSU (government-owned entities) picks - Satluj Jal Vidyut Nigam (SJVN) and ONGC - have experienced a significant rally. Likewise, its capital goods investments, particularly its timely entry into Sterling and Wilson, have proven beneficial. ITI Focused Equity Fund's standout stocks Top three stocks based on returns from June 30, 2023, to February 29, 2024. BSE 500 TRI delivered 22.8 per cent during this period. Stock Average allocation (%) Return (%) Suzlon Energy 3.01 195.8 MCX India