Fund houses ease limits on small-cap plans; managers see opportunities

DSP on Monday opened the DSP Small Cap Fund for subscription through systematic investment plans and systematic transfer plans

Small-cap schemes, which had imposed limits on investor inflows amid surging valuations, have started easing some of these restrictions. Fall in valuations to more reasonable levels and signs of earnings recovery are prompting money managers to deploy fresh funds into stocks in this space.

“The entire small cap space has corrected. While the small cap index is down 12-13 per cent, a few stocks have corrected much more. Amid this fall, we have found pockets of opportunities. While these may not be extremely cheap, they are still reasonable. The earnings cycle also seems to be picking up for these companies,”