Slow NFO Launch Activity In 2026 Despite Good MF Inflows

While mutual fund inflows saw a good level, activity in terms of launching new funds was slower in the first four months of 2026, as against the same period last year, based on AMFI data.

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

In all, 69 NFOs have been launched during the period from January to April 2026, fewer than the 77 NFOs launched in the corresponding period of 2025.

As of March 2026, around ₹10,650 crore had been mobilised through NFOs, compared with nearly ₹13,000 crore raised across 77 schemes in the January-April period last year, AMFI data showed.

NFO Launches See Uneven Monthly Trend

The pace of launches remained uneven during the first four months of the year. During the month of January, fund houses offered 12 NFOs, which increased to 21 in February and 23 in March. But the pace was slowed down in April, when only 13 NFOs were launched during the month.

The increase in NFOs during February and March occurred in the midst of volatile market sentiments. During this period, benchmark equity indices fell by over 11%, whereas the BSE 250 SmallCap index fell above 10% during March.

Even after experiencing volatile market sentiments, asset management firms went ahead with their launch plans, resulting in an increased number of NFOs during these two months.
Recovery in the Market Did Not Help NFO Issuance Pace

April proved to be a month of strong recovery in benchmark indices as well as other indices. Benchmark indices showed a gain of about 7-8%, midcap indices recorded an increase of 13.8%, and smallcap indices registered a jump of 18.6%.

Despite the strong recovery seen in the equity markets, the number of NFOs launched in April was just 13. However, April 2026 still recorded higher launches compared with seven NFOs launched during the same month last year.

Fund Houses Focus On Product Strategy

Mutual fund companies said launches are primarily driven by long-term product strategies rather than short-term market movements.

Edelweiss Mutual Fund said its focus remains on launching products where there are gaps in offerings or during periods when valuations are reasonable.

Motilal Oswal Mutual Fund also said launches continue to follow long-term business plans and product pipelines irrespective of near-term market conditions.

According to Tata AMC, recent launches have also been aided by growth in passive investment products and finding segments with investor interest potential.

Growth in SIF Products

Another category that is gaining increased interest in 2026 is the Specialized Investment Funds (SIF). According to the industrial report, the total number of SIF products stood at 14, and the total investment in asset management was ₹10,000 crore by March 2026.

Four SIF-based NFOs were introduced in April, out of which two are currently being offered, while two have already been concluded. This has been seen as another step towards the growing number of fund companies getting approval to offer SIF products.