Every new fund offer opens at the same price. Ten rupees a unit. The pitch leans on it, the unit looks cheap and the entry feels like a ground floor. So this page does the obvious test. Take a basket of equity NFOs, note that each one started life at ₹10 and follow where that ₹10 actually went after listing. If the ₹10 carried any information about the fund underneath, the outcomes would cluster. They do not.
The ₹10 Everyone Starts At #
The ₹10 face value is an industry convention, not a valuation. A scheme launches, collects money during the offer window and allots units at ₹10 regardless of what it plans to buy. A fund that will hold the same large caps as a ₹900 NAV scheme still issues at ₹10. The number reflects when the fund opened its doors and nothing about the portfolio behind it. The full arithmetic of why a low NAV is not a discount sits in the main NFO explainer and the tax myth page.
Across the 21 funds here the first post-allotment NAV ranged from ₹9.94 to ₹10.36, all within a whisker of ₹10. That is the starting line. Everything after it is the portfolio doing its work and the portfolios diverge fast.
Where the ₹10 Went #
Same ₹10 start, 18 months to four years later. The result is not a cluster, it is a fan that runs from ₹8.15 to ₹30.47.
Crimson = below the ₹10 issue price. 21 open-ended equity NFOs launched 2022 to 2024, Direct plan Growth option. Source: AMFI daily NAV via mfapi.in, as of 19 June 2026.
Two of the 21 are still worth less than the ₹10 they were issued at and this is after a stretch in which Indian equities and especially mid and small caps ran hard. At the one-year mark three of them sat below ₹10. The ₹10 told a subscriber nothing about which of these outcomes they were buying. HDFC Defence turned ₹10 into ₹30.47 while Shriram Multi Sector Rotation turned the same ₹10 into ₹8.15 and at issue both were indistinguishable ₹10 units.
The gap was not the ₹10. It was the slice of the market each fund happened to own. The biggest gainers here are defence, small-cap and manufacturing funds, the segments that rallied hardest over the window. That return was available from any existing fund or plain index fund in the same segment, with a track record to read first and without the blind-pool and deployment lag an NFO carries.
Beating ₹10 Is Not Beating the Benchmark #
A positive NAV is a low bar. Nineteen of the 21 cleared it. The bar that decides whether a fund earned its keep is the benchmark, the index it could have been replaced by for a fraction of the fee. Measured that way, against a plain low-cost index fund matched to each fund's market-cap segment and pulled from the same NAV source over the identical window, the 11 diversified funds in the sample mostly cleared the bar too. Ten of 11 beat their segment index, one lagged.
That looks like a win for active NFOs until the method is read honestly and three things flatter it. The sample can only contain funds that are still alive, because the data source carries live schemes, so the NFOs that merged or wound up before today, typically the worst, are invisible. The window, 2022 to 2026, was an unusually strong one for Indian equities. And the figures use the low-cost Direct plan, while most NFO buyers are sold the Regular plan that runs roughly a percentage point a year behind. This sample is the rosy end of the distribution and even it contains outright losers.
HDFC Defence is the basket's star. In this study it turned ₹10 into ₹30.47, a 44% annualised return to 19 June 2026. Measured over its own earlier window and against its stated sector benchmark, a separate bl.portfolio analysis put it at about 35% a year versus the Nifty India Defence TRI's roughly 52%, so it trailed the very index it was built to track even while tripling a subscriber's money. The two figures measure the same fund over different windows and both point the same way. The NAV multiple felt like skill. The benchmark said the theme did the work and the fund kept less of it than the index would have. The ₹10 and even the headline return hid that.
For the sectoral and thematic funds the stated benchmark is a narrow sector index, which a free NAV feed cannot reproduce, so the table shows them against the broad market as an opportunity-cost yardstick rather than scoring them against their own index. The behavioural pull behind these launches is its own subject, covered in why the bank RM is pushing this NFO.
The Stricter, Bigger Picture #
A 21-fund live-survivor sample over a bull market is the optimistic bound. The larger, survivorship-aware, benchmark-strict evidence is harsher. A bl.portfolio analysis of 275 active equity fund NFOs launched between 2020 and March 2026 found that 133 of them, 48%, had underperformed their benchmarks since inception. For sectoral and thematic funds alone the failure rate was 50%. In its own words it is a coin-flip. The same study counted 1,187 NFOs launched across all categories in six years raising ₹4.67 lakh crore, with annual launches climbing from 64 in 2020 to a record 273 in 2025.
The backdrop is worse still. The SPIVA India Year-End 2024 scorecard found 93.33% of large-cap funds, 77.08% of mid and small-cap funds and 72.09% of ELSS funds had trailed their benchmarks over five years. An NFO starts from that base rate of active underperformance and adds the one disadvantage a ten-year-old fund does not carry, no track record to read. The denomination has nothing to say about any of this.
The Full Data #
All 21 funds, every figure used above. The first column is the NAV on the first post-allotment date, near ₹10 for each. The benchmark column is the matching index fund's annualised return over the same window. The gap is the fund's CAGR minus that index fund's, in percentage points a year. A skeptical reader can re-pull any row from the scheme code listed in the method note.
| Fund | Launched | NAV at launch | NAV @ 1yr | NAV @ 3yr | NAV now | CAGR since launch | Index fund, same window | Gap %/yr |
|---|---|---|---|---|---|---|---|---|
| Diversified equity funds. Benchmark is the matching cap-segment index fund | ||||||||
| Mahindra Manulife Small Cap Small Cap · Mahindra Manulife | Dec 2022 | ₹10.02 | ₹15.52 | ₹20.25 | ₹22.19 | 25.4% | 18.0% | +7.4 |
| WhiteOak Capital Mid Cap Mid Cap · WhiteOak | Sep 2022 | ₹10.08 | ₹13.01 | ₹20.15 | ₹22.48 | 23.7% | 18.8% | +4.9 |
| Edelweiss Multi Cap Multi Cap · Edelweiss | Oct 2023 | ₹10.15 | ₹15.32 | — | ₹16.16 | 19.3% | 12.8% | +6.5 |
| Helios Flexi Cap Flexi Cap · Helios | Nov 2023 | ₹10.22 | ₹13.81 | — | ₹15.82 | 18.4% | 11.4% | +7.0 |
| 360 ONE Flexicap Flexi Cap · 360 ONE | Jul 2023 | ₹10.05 | ₹15.38 | — | ₹16.37 | 18.0% | 11.7% | +6.3 |
| Bajaj Finserv Flexi Cap Flexi Cap · Bajaj Finserv | Aug 2023 | ₹10.02 | ₹14.20 | — | ₹15.84 | 17.5% | 11.7% | +5.7 |
| Motilal Oswal Multi Cap Multi Cap · Motilal Oswal | Jun 2024 | ₹10.25 | ₹13.53 | — | ₹13.53 | 14.9% | 2.1% | +12.8 |
| WhiteOak Capital Large Cap Large Cap · WhiteOak | Dec 2022 | ₹9.94 | ₹11.42 | ₹16.19 | ₹15.52 | 13.4% | 9.3% | +4.2 |
| Baroda BNP Paribas Value Value · Baroda BNP Paribas | Jun 2023 | ₹10.03 | ₹14.14 | ₹13.93 | ₹14.37 | 12.6% | 13.3% | -0.6 |
| Bajaj Finserv Large and Mid Cap Large & Mid Cap · Bajaj Finserv | Feb 2024 | ₹10.02 | ₹10.76 | — | ₹12.67 | 10.7% | 6.4% | +4.4 |
| Franklin India Multi Cap Multi Cap · Franklin | Jul 2024 | ₹10.00 | ₹10.33 | — | ₹10.86 | 4.4% | -0.5% | +4.9 |
| Sectoral and thematic funds. Shown against the broad market (BSE 500 index fund) as opportunity cost; each fund's stated benchmark is a narrower sector index | ||||||||
| HDFC Defence Sectoral · HDFC | Jun 2023 | ₹10.01 | ₹22.83 | ₹28.44 | ₹30.47 | 44.1% | 13.3% | +30.8 |
| ICICI Prudential Innovation Thematic · ICICI Pru | May 2023 | ₹10.04 | ₹15.74 | ₹18.83 | ₹19.54 | 23.7% | 14.2% | +9.5 |
| Quant Manufacturing Thematic · Quant | Aug 2023 | ₹10.02 | ₹17.18 | — | ₹17.20 | 21.0% | 11.7% | +9.2 |
| Bandhan Financial Services Sectoral · Bandhan | Jul 2023 | ₹10.02 | ₹13.49 | — | ₹15.51 | 16.4% | 11.1% | +5.2 |
| Nippon India Innovation Thematic · Nippon India | Sep 2023 | ₹10.09 | ₹14.87 | — | ₹14.97 | 15.2% | 11.4% | +3.7 |
| ICICI Pru Energy Opportunities Sectoral · ICICI Pru | Jul 2024 | ₹10.02 | ₹10.52 | — | ₹12.03 | 10.1% | 0.7% | +9.4 |
| HDFC Manufacturing Thematic · HDFC | May 2024 | ₹10.11 | ₹10.54 | — | ₹11.68 | 7.2% | 5.0% | +2.1 |
| SBI Energy Opportunities Sectoral · SBI | Mar 2024 | ₹10.09 | ₹8.74 | — | ₹11.68 | 6.6% | 5.8% | +0.8 |
| Samco Special Opportunities Thematic · Samco | Jun 2024 | ₹10.36 | ₹8.76 | — | ₹9.06 | -6.4% | 2.5% | -8.9 |
| Shriram Multi Sector Rotation Thematic · Shriram | Dec 2024 | ₹9.99 | ₹8.09 | — | ₹8.15 | -12.6% | -0.4% | -12.1 |
A blank in the 3-year column means the fund has not yet reached its third anniversary. Gap is positive when the fund beat its index over the window and negative when it lagged. For sectoral and thematic rows the index shown is the broad market, not the fund's narrower stated benchmark.
Note on Method and Sources #
Sample. A fixed cross-section of 21 open-ended equity NFOs whose first NAV falls in calendar 2022 to 2024, chosen to span the market-cap segments and the sectoral and thematic bucket that dominated NFO supply over the period and to mix large and small AMCs. The list was fixed before any return was computed. It is a named cross-section, not a random draw and not the full population.
Survivorship. The NAV source carries only schemes that are still live. NFOs that were merged or wound up before 19 June 2026 cannot appear and those are typically the weakest. A live-only sample therefore overstates how NFOs have done. The true picture is worse than the table, not better.
NAVs. Pulled from the free api.mfapi.in, which mirrors AMFI's daily NAV file. Direct plan, Growth option for every fund. The launch NAV is the first post-allotment NAV on record, near ₹10. The 1-year and 3-year NAVs are the nearest trading day to each anniversary. The latest NAV is dated 19 June 2026.
Returns. Since-launch CAGR is the point-to-point time-weighted figure, the latest NAV over the first NAV raised to 365.25 over the number of days held, minus one. The Direct plan is used, so the figures run roughly a percentage point a year ahead of the Regular plans most NFO subscribers are sold.
Benchmark. Each fund is compared with a plain cap-weighted index fund matched to its segment, Nifty 100 for large cap, Nifty Midcap 150 for mid cap, Nifty Smallcap 250 for small cap and a BSE 500 index fund for flexi, multi, value and large-and-mid funds, pulled from the same source over the identical window. An index fund is a slightly easier bar than the gross total-return index it tracks, because it carries its own small fee and tracking error, so the comparison flatters the active funds. Sectoral and thematic funds are shown against the broad market as opportunity cost because their narrow stated benchmarks are not available from a free feed. None of the benchmark figures is estimated.
Reproduce it. mfapi.in scheme codes used. Funds: WhiteOak Large Cap 150797, WhiteOak Mid Cap 150584, Mahindra Small Cap 150915, Baroda BNP Paribas Value 151755, 360 ONE Flexicap 151796, Helios Flexi Cap 152135, Bajaj Finserv Flexi Cap 151895, Edelweiss Multi Cap 152094, Bajaj Finserv Large and Mid Cap 152408, Motilal Oswal Multi Cap 152651, Franklin India Multi Cap 152739, ICICI Prudential Innovation 151580, HDFC Defence 151750, Bandhan Financial Services 151816, Quant Manufacturing 151916, Nippon India Innovation 152033, SBI Energy Opportunities 152417, HDFC Manufacturing 152600, Samco Special Opportunities 152586, ICICI Pru Energy Opportunities 152728, Shriram Multi Sector Rotation 153076. Benchmarks: Nifty 100 147666, Nifty Midcap 150 148726, Nifty Smallcap 250 148519, BSE 500 151728. The endpoint is api.mfapi.in/mf/<code>. Larger-sample figures are bl.portfolio's 275-NFO analysis (2020 to March 2026) and the S&P Dow Jones Indices SPIVA India Year-End 2024 scorecard.
The ₹10 is settled. The harder question, whether a given fund is worth subscribing to on day one at all, is laid out in full in the pillar.
Read: Are NFOs Worth It?FAQ #
Does buying an NFO at ₹10 mean it is cheaper than a fund at ₹100?
No. The ₹10 is an industry convention for the price at which a new scheme allots units, not a valuation. A fund issuing at ₹10 can hold exactly the same portfolio as one quoting ₹900. Across the 21 NFOs tracked here, all of which started near ₹10, the unit was later worth anywhere from ₹8.15 to ₹30.47, which shows the ₹10 carried no information about the fund underneath.
What actually happened to the ₹10 across these funds?
Tracked from launch to 19 June 2026, the same ₹10 ranged from ₹8.15 at the worst to ₹30.47 at the best, a 3.7 times spread. Two of the 21 were still below the ₹10 issue price even after a strong few years for Indian equities. The funds that did best owned the market segments that rallied hardest, defence, small caps and manufacturing, returns available from existing funds in those segments without an NFO's blind-pool risk.
Did the NFOs beat their benchmarks?
Among the 11 diversified funds in the sample, ten beat a plain index fund matched to their segment over the window and one lagged. That is the optimistic bound, because the sample can only include funds still alive today, the window was an unusually strong one and the figures use the low-cost Direct plan. The broader, survivorship-aware bl.portfolio study of 275 NFOs launched since 2020 found 48% had underperformed their benchmark, a coin-flip.
Can a fund triple in value and still have underperformed?
Yes. In this study HDFC Defence turned ₹10 into ₹30.47, a 44% annualised return to mid-2026. Over its own earlier window a separate bl.portfolio analysis put it at about 35% a year against its Nifty India Defence TRI's roughly 52%, so it trailed the index it was built to track even while tripling a subscriber's money. The two are different windows on the same fund, not a contradiction. A high NAV multiple measures the theme, not the manager. Only the benchmark separates the two.
How can I reproduce this study myself?
Every NAV comes from the free api.mfapi.in, which mirrors AMFI's daily NAV file. The method note lists the scheme code for each of the 21 funds and the four benchmark index funds. Pulling api.mfapi.in/mf/ followed by the code returns the full NAV history, from which the launch NAV, the anniversary NAVs and the since-launch CAGR can be recomputed. The one caveat the data cannot fix is survivorship, since the feed carries only live schemes.
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