During the period April-September 1998, a total of 26 schemes have been launched. According to figures collated by Sebi, of these schemes, eight schemes were launched by UTI, compared to 12 launched by the private sector and six by the public sector.

During the same period, of the 26 schemes, 12 were income schemes, there were 10 growth schemes and four schemes were balanced funds. Among the 26 schemes that were launched, 17 schemes were open-ended, while seven schemes were close-ended with two schemes in the interval category.

``The number of income schemes that are being launched by mutual funds points to the fact that investors have lost the desire for equity products and the assured return income schemes are the flavour of the day with investors flocking to these schemes in a jiffy,'' said a head of the fixed income at Prudential ICICImutual fund, Dileep Madgavkar.

``With equity markets in a bad shape the risk taking capacity of investors has considerably reduced. Investors are reducing the risk by investing in income schemes as they provide safety as well as return. So, it is actually the risk to return trade off which is attracting the investors. Although, equity gives better returns over time than debt the risk attached to equity is higher,'' added Madgavkar.

``During the period April-September, the markets have been volatile with negative factors like disappointing budget, nuclear tests, payment crises in the market and not-so-impressive first quarter results. We are clearly talking of very volatile and risky equity markets with a very high risk in equity'' said the head of equity research at Apple Mutual Fund, Hitesh Zaveri.

``Thus, the investors looking at the risk and return equation are moving into income schemes leading to mutual funds launching more debt products. But, this does not mean that growth schemes are notperforming well. Although, performance of some of the schemes is not good it will take time before investors will flock back to the equity markets. We feel this year we will see more of debt products being launched by mutual funds as compared to equity,'' said Zaveri.

Meanwhile, the mutual fund industry launched 28 schemes, in all, in the financial year 1997-98, while the number launched in 1996-97 was 32, and the number of schemes launched in 1995-96 was 30.

The private sector mutual funds outdid the public sector mutual funds in terms of number of schemes launched in 1997-98. The private sector mutual funds launched 10 schemes (excluding Birla Liquid Fund), while the public sector launched only six schemes in all. UTI launched a total of 12 schemes during the same period.

``The public sector mutual funds have lost their touch as they are busy keeping old promises with little or no new products and services to offer,'' said the managing director of a mutual fund.

While the mutual fund industry hasgarnered Rs 8,514 crore in the first quarter of the current financial year in April-July. In this kitty, UTI managed to mobilise Rs 6,659 crore with the non-UTI mutual funds, both the public sector and the private sector mutual funds, garnered Rs 1,683 crore.