One of India's largest asset management companies, Quant Mutual Fund, has seen equity redemptions amounting to Rs. 1,398 crores in the last three days, according to its founder Sandeep Tandon. This accounts for approximately 1.5% of its total asset under management (AUM).
Tandon noted the spike in outflows can be attributed to some media reports from last week speculating that the markets regulator SEBI had conducted searches at Quant's offices over suspicions of fraudulent trading practices. While the fund house did not provide any comments initially, it has since confirmed receiving inquiries from SEBI and has assured full cooperation with any regulatory process.
Despite the negative publicity, Tandon stated gross inflows into Quant schemes have remained steady while only gross outflows have increased marginally. The fund maintains a sizable liquidity buffer with liquid assets like large caps, cash and bonds accounting for over 54% of its AUM. Stress tests also indicate it can liquidate parts of flagship funds in under a month if required.
Since launching in 2018 with just Rs. 27 crores, Quant has grown exponentially to manage over Rs. 93,000 crores in assets from 84 lakh investor folios across 26 product offerings today. As a risk measure, Tandon noted the company has shifted some allocations from smaller caps to larger liquid stocks. Quant Fund reiterated confidence in the mid and small cap space fundamentally.
