ICICI Pru FlexiCap Fund becomes highest-ever NFO; raises nearly Rs 10,000 crore

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Receiving strong investor response, ICICI Prudential AMC’s latest offering – ICICI Pru FlexiCap Fund — has collected nearly Rs 10,000 crore in its new fund offering (NFO). The issue has received more than four lakh retail applications and the NFO was sold by over 15,000 distributors.

“ICICI Prudential Flexicap Fund NFO has been a resounding success. Over four lakh retail investors applied to the NFO. This would not have been possible without the support of more than 15,000 distributors spread across the country who helped us in taking the product to every discerning investors,” the ICICI MF spokesperson told Money9.

The record NFO collection is no surprise given the process oriented approach and robust performance track record the fund house enjoys across asset classes.

Prior to this, Reliance Natural Resources Fund had garnered the highest funds in its NFO with Rs 5,660 crore at the peak of a bull run in 2008.

ICICI Pru FlexiCap Fund was launched on June 28 and closed on July 12. The fund will invest in the largecap, midcap and smallcap stocks as per the market dynamics. The fund house has developed an in-house marketcap model involving parameters such as market cap weight as a percentage of total marketcap, valuations and Relative Strength Index (RSI) Differential. Besides, it has specified a tentative asset allocation range – Largecap range (50-100%) and mid & smallcap Range (0-50%) – to pick stocks.

Expert view

“What worked in the fund’s favour is its defined strategy to pick stocks and a tentative asset allocation, which made it simpler to explain the product to retail investors,” says mutual fund distributor Avdesh Mishra, who is founder of Caterpillar Insurance & Investment Services.

Mishra adds that the fund has breached his own targets he had set for himself.

“I could add 7-8% more to my AUM in just 12 days – well beyond my expectations,” he adds.

High valuations

A lot of NFOs have been coming in at a time when the stock market indices are hovering around all-time highs, much above their historical valuations.

“While the markets are at all-time highs, the fund house has clarified that they will deploy the money in the next six to nine months. So, if the market crashes from hereon, it’ll be an opportunity for the fund (and investors) to earn better returns. The fund strategy gave me conviction to get my clients invested in this product,” says Mishra.