Six months after the first further fund offer (FFO) of Bharat 22 ETF, the government has decided to raise some more capital through the ETF route with Bharat 22 ETF.
In the latest development, ICICI Prudential MF has announced the FFO of Bharat 22 ETF from June 19 to June 22. Investors will get a discount of 2.5% on the second tranche of Bharat 22 ETF during its FFO.
This FFO is part of the government of India's overall disinvestment program, announced earlier by the Department of Investment and Public Asset Management (DIPAM), Ministry of Finance, using the ETF route.
The AMC proposes to raise up to Rs.6,000 crore in this FFO with an option to retain oversubscription, subject to Government of India’s approval. "The success of Bharat 22 ETF NFO managed by ICICI Prudential AMC highlighted investor confidence in the India growth story as represented by the industry leading stocks of the ETF. The NFO was oversubscribed by all investor categories including retail investors. With a view to encourage further participation by the existing investors and also bring in new investors we are happy to launch follow on offer of Bharat 22 ETF", said Atanu Chakraborty, Secretary DIPAM, Ministry of Finance.
"The FFO with the discount offered, is an opportunity to partake in the India growth story by way of diversified companies spread across several sectors which are available at attractive valuation”, said Nimesh Shah, MD & CEO, ICICI Prudential AMC.
Bharat 22 consists of 22 stocks of Central Public Sector Enterprises (CPSEs), Public Sector Banks (PSBs) and strategic holdings of Specified Undertaking of the Unit Trust of India (SUUTI). The Bharat 22 Index will be rebalanced annually.
The Bharat 22 constitutes companies like National Aluminium, ONGC, Coal India, IOC, BPCL, SBI, Axis, Bank of Baroda, Rural Electrification Corporation, Power Finance Corporation, Indian Bank, ITC, Bharat Electronics, Engineers India NBCC, Power Grid, NTPC, Gail India, NHPC, NLC India and SJVN. The Government of India holds a majority stake in most of these companies.
The FFO is open for all categories of investors including anchor investors, retail investors, retirement funds, QIBs, non-institutional investors and foreign portfolio investor (FPIs).