The second tranche of Bharat-22 exchange traded fund (ETF) will be launched by the government on June 19. For anchor investors, the subscription will open tomorrow. The further fund offer (FFO) closes on June 22, 2018. The fund which is part of the Narendra Modi government's divestment programme has 22 firms as its constituents. The government plans to raise up to Rs 8,400 crore.
ICICI Prudential Asset Management Company is managing the launch of Bharat 22 ETF which is being offered at 2.5% discount to all the investor categories.
The ETF comprises leading companies from the private sector having an exposure of 39 per cent to the fund while the rest are public sector firms. The state-owned companies or PSUs that are part of the new Bharat ETF-22 include ONGC, IOC, SBI, BPCL, Coal India and Nalco.
The other central public sector enterprises on the list are Bharat Electronics, Engineers India, NBCC, NTPC, NHPC, SJVNL, GAIL, PGCIL and NLC India. Only three public sector banks -- SBI, Indian Bank and Bank of Baroda -- figure in the Bharat-22 index.
The fund consists of stocks from six sectors such as capital goods, finance, oil & gas, power, FMCG and metal, metal products and mining.
In November last year, the government launched the Bharat 22 ETF Bharat 22 which received subscriptions worth Rs 31,817 crore of which the government decided to retain Rs 14,500 crore and return the rest to subscribers. A discount of 3 per cent was offered to all categories of investors.
The fund comprising 22 firms was listed on the bourses with over 3 percent gains on November 28, 2017. The ETF saw huge interest from anchor investors with portion reserved for them getting subscribed six times to the tune of Rs 12,000 crore on the opening day.
The government has set an ambitious target of raising Rs 72,500 crore for disinvestment in the current fiscal. Of this, Rs 46,500 crore is to be raised through minority stake sale in PSU and Rs 15,000 crore from strategic sale. Another Rs 11,000 crore is to come from listing of insurance companies.