Street Signs: Flexicaps lead MF space; IPO street set to buzz again

Flexible equity schemes top assets and inflows as investors turn cautious in a patchy market

Flexicaps grip the wheel, sector funds in rearview 

Flexicap funds have overtaken sectoral and thematic schemes to become the largest active equity category in November. These funds, which can shift capital freely across large, mid, and smallcap stocks, have staged a comeback in investor interest over the past year as markets turned volatile. As of November 27, the category managed ₹5.5 trillion in assets, slightly above the ₹5.2 trillion held by sectoral and thematic funds, according to data from the Association of Mutual Funds in India. Flexicap schemes have also been leading inflows, collecting nearly ₹9,000 crore in October after three consecutive months of more than ₹7,000 crore in net investments. 

The rally is here, the breadth isn’t 

Last month, the Nifty finally cleared its 14-month resistance zone to set a new all-time high. November’s gains were helped by investors rotating out of artificial intelligence names and building up bets on global monetary easing. But underneath the strong performance of headline indices, the broader market picture remained uneven. The Nifty Midcap 100 was up 2 per cent in November and climbed to a new peak, pointing to institutional interest in high-quality stocks in the segment. In contrast, the Nifty Smallcap 100 fell 3 per cent and is 9 per cent below the highs it touched in December 2024. “The real question now is whether the broader market will join the rally. Based on the current technical setup, smallcaps may continue to trail in the near term. The uptrend is likely to stay narrow and stock-specific, supported by sector rotation,” said Sudeep Shah, head of technical and derivatives research at SBI Securities. 

IPO lane to reopen with 3-stock sprint 

After a quiet week, the initial public offering (IPO) market is set to heat up again with three issues: Meesho, Aequs, and Vidya Wires. Together, they plan to raise ₹6,642 crore. Meesho and Aequs are trading in the grey market at about 35 per cent above their issue price, while Vidya Wires is at 17 per cent. December has traditionally been slow for IPOs, but the post-pandemic shift away from foreign portfolio investors has changed that trend. In three of the past four years, December has seen more than 10 IPOs. Some estimates put this month’s expected count at 28, which would make it the busiest December for IPOs since 1996.