The Government of India on Tuesday launched the Bharat-22 Exchange Traded Fund (ETF) managed by ICICI Prudential Mutual Fund to raise about Rs 8,000 crore. "The units of the scheme will be allotted 25 per cent to each category of investors".
Mayuresh Joshi, Fund Manager, Angel Broking said, "The composition of Bharat 22 ETF is such that only large cap, dividend paying companies are available".
Under this ETF, the Retirement Fund has been made a separate category of investors.
In case of spill-over, additional portion will be allocated giving preference to retail and retirement funds, it said, adding, there is a 3% discount across the board.
ICICI Prudential provides four reason for investing in this ETF. The Bharat 22 ETF, comprises scrips of 22 companies including 19 public sector enterprises, which includes National Aluminium Company, Coal India, State Bank of India, Axis Bank, Indian Bank, Larsen and Toubro and Bharat Electronics among others. "We are delighted to see the overwhelming response received from anchor investors and aiding the Government of India's disinvestment programme". NHPC, NLC India, NTPC, Oil & Natural Gas Corp, Power Finance Corp, Power Grid Corp of India, Rural Electrification Corp and SJVN are the other constituents of the fund.
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These companies would benefit from government reforms and initiatives such as financial inclusion, digitisation, Make in India, Goods & Services Tax (GST) and infrastructure reforms and belong to six sectors like basic materials, energy, finance, fast-moving consumer goods (FMCG), industrials and utilities.
Only three public sector banks - SBI, Indian Bank and Bank of Baroda - figure in the Bharat-22 index.
This ETF is a part of government of India's overall disinvestment program, announced earlier by the Department of Investment and Public Asset Management.
The government has raised a total of ₹11,500 crore through the CPSE ETF (first launched in March 2014) comprising 10 PSUs, including the ones mentioned above.