EIML expects the fund to generate Rs500 – 1000 crores AUM for its open ended AIF and PMS
FinTech BizNews Service
Mumbai, June 3 2025: Emkay Investment Managers Limited (EIML), the asset management arm of Emkay Global Financial Services, has announced the launch of ‘Emkay SMID Cap Growth Engine Fund’. EIML is aiming to raise Rs 500-1000crores from the latest fund in the FY26.
About SMID Cap Growth Engine AIF Fund and PMS
Investment Objective: The product seeks to achieve long-term capital appreciation by investing primarily in small cap & mid cap securities.
Description of types of Securities: Under this PMS and AIF product investments are made in equities and equity related instruments. A balanced and well-diversified equity portfolio is created based on fundamental research.
Investment Approach: The strategy follows a bottom-up stock picking process which is backed by extensive fundamental analysis comprising of in-depth study of business , management and valuation
Strategy: Listed Equity
Benchmark: S&P BSE 500 TRI
Investment Horizon: Investors in this portfolio should have an investment horizon of two-three years.
Fund Managers: Manish Sonthalia and Kashyap Javeri
Small & Mid Cap (SMID) offers broader exposure to India’s growth story through innovation, digitalisation, capex, and consumption, providing more opportunities for alpha generation compared to large caps. These sectors are likely to benefit from macro tailwinds such as easing inflation, declining interest rates, rising household income boosting consumption, and liquidity measures supporting market revival translating into higher growth. Given that SMID companies tend to rely more on borrowing for their operations and growth, their higher sensitivity to interest rate cycles positions them to revive and potentially outperform in an environment of easing retail inflation and declining rates.
According to EIML, mid and small-cap companies are anticipated for positive growth over next 3-5 years, making them a good potential bet for investing. EIML also highlights that mid and small-cap stocks have delivered a robust return over the past five years. It further notes that the current macroeconomic conditions and supportive valuations present an attractive entry point for SMID investments, particularly following the recent market correction.
As of March 2025, small-cap and mid-cap mutual funds (MFs) together constitute over ~30% of total equity flows, a significant jump from ~5% a year ago. The dual support from foreign institutional investors (FIIs) and mutual funds makes this rally much more sustainable. Strengthening flows into SMID segments suggest that select opportunities in small and mid-cap stocks could outperform over the medium term.
Manish Sonthalia, Director & Chief Investment Officer, Emkay Investment Managers Limited said, “SMID offers a compelling mix of growth potential, valuation, comfort and supportive macro trends, making it a strong candidate for investment. The fund follows focussed bottom-up stock picking backed by in-depth fundamental research based on our E-Qual Framework, arguably, the only framework of its kind in India, to score management quality objectively.”
