What is your message to investors who are panicking after the announcement?
Our advice to investors is to not take a knee-jerk reaction on Monday. Let things get clarified over the next couple of months before taking any call.
Will Amfi approach Sebi soon?
Amfi will take up the industry point of view with Sebi.
We don’t have to write to them today. We will discuss the issue among ourselves, reach a consensus and then bring it to the attention of the regulator.
What could have triggered this move?
Sebi is coming from a true-to-label point of view. When you run a multi-cap scheme, it needs to have exposure to all the three — large-, medium- and small-cap stocks. I don’t think one can find fault with that. At the same time, Sebi as our regulator, will not want us to blindly follow things. And this includes buying stocks after valuations go up. I don’t think it is Sebi’s intention to make fund managers buy stocks at any price. Their intention is to ensure things remain true-to-label.
There are concerns that small-caps will not be able to absorb that kind of demand?
Everything is linked to valuation. The point on floating stock is valid. But if there is less supply and more buying, valuations will go up as price goes up. When I say valuations, I am giving a distilled view.