NFO launch: ICICI Prudential Nifty200 Value 30 ETF, ICICI Prudential Nifty200 Value 30 Index Fund in focus. Details here

ICICI Prudential Mutual Fund has recently unveiled the ICICI Prudential Nifty200 Value 30 ETF, an open-ended Index Exchange-Traded Fund that tracks the Nifty200 Value 30 Index. In addition, the AMC has introduced the ICICI Prudential Nifty200 Value 30 Index Fund, which mirrors the Nifty200 Value 30 Index. These new products are classified under the smart beta category, emphasizing a factor-based investment strategy aimed at providing investors with a cost-effective, value-centric approach.

The Nifty200 Value 30 Index comprises 30 stocks carefully selected from the Nifty 200 Index using a 'Value Score.' This scoring methodology evaluates crucial valuation metrics to assist investors with a penchant for value in identifying potential investment opportunities. Through this index, investors gain exposure to companies deemed to possess promising prospects for sustainable long-term growth.

Investment strategy

Value-based investing is a strategy that focuses on value investment, which involves identifying undervalued stocks in the market to potentially achieve higher returns.

Diversification is a key aspect of these schemes, as they offer exposure to 30 companies across different sectors. This diversification helps investors spread their risk and optimize their share portfolio.

Both schemes prioritise transparency and cost-effectiveness, providing investors with low-cost options and maintaining low portfolio turnover to enhance overall efficiency.

Chintan Haria, Principal – Investment Strategy at ICICI Prudential AMC, said: "At a time when investors are seeking diversified strategies for long-term growth, value investing remains a crucial component of a well-rounded portfolio. We are excited to introduce the Nifty200 Value 30 ETF and Index Fund, offering investors a targeted approach to value-based investing, which is designed to provide growth over the long term."

Sectors in focus

The index Nifty200 Value 30 is exposed to Financial Services, Oil, Gas & Consumable Fuels, Metals & Mining, Power, Construction Materials, Chemicals and Telecommunication.

Index performance

The Nifty 200 Value 30 TRI outperformed the Nifty 200 TRI six times during the last ten years, indicating that value investing is a feasible strategy for an investor's portfolio under certain market conditions.

The index compositions are aligned to the prevailing circumstances in the market. For example, it was overweight on the financial services in 2023 and 2024 in the index composition, since the value score of the sector's stocks was higher. This flexibility ensures that the exposure to various sectors is calibrated regularly in line with the value opportunities available on a quantitative basis.

As the universe of stocks is NSE 200, the portfolio also has midcap stocks. Due to the use of value score, the exposure levels to the midcaps keep changing. For example, midcap stocks had more value in 2022, but in 2019, the exposure to midcap stocks was the least in the last five years.