Bharat-22 ETF opens today; government eyes Rs 8K crore

The government will have the option to retain any additional amount that it mobilises

Divestment secretary Neeraj Gupta speaks to ET Now about the Bharat 22 ETF that opens for subscription on November 15.

Mayuresh Joshi, Fund Manager, Angel Broking said, "The composition of Bharat 22 ETF is such that only large cap, dividend paying companies are available. In this ETF, the Retirement Fund has been made separate category of investors", a finance ministry statement said. Government companies constitute 61 percent of the index, and private sector companies are 39 percent. The other central public sector entities on the list are Bharat Electronics, Engineers India, NBCC, NTPC, NHPC, SJVNL, GAIL, PGCIL and NLC India.

ICICI Prudential on Monday announced the much-awaited launch of Bharat-22 open ended exchange-traded fund, which is a part of the Centre's disinvestment program worth ₹72,500 crore for FY18.

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. Through the ETF, ICICI Prudential AMC proposed to raise an initial amount of Rs 8,000 crore plus additional amount subject to approval from the Government of India. The ETF launched mirrors the S&P BSE Bharat 22 Index which comprises of select companies from the CPSE universe, stakes held under the Specified Undertaking of the Unit Trust of India (SUUTI) and Public Sector Banks (PSBs), from the underlying universe consisting CPSE companies, SUUTI A Group companies, and PSU Banks. "Over the next three days, we look forward to active participation from Non Anchor Investor category who have the opportunity to participate in the India growth story, at a discounted price, through this attractive long term investment opportunity", ICICI Prudential Mutual Fund managing director and chief executive officer (CEO) Nimesh Shah said in a statement. The government hopes to mobilise about Rs 10,000 to Rs 12,000 crore through the NFO.

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