Bharat-22 ETF offer oversubscribed

MUMBAI: Bharat-22 ETF’s (Exchange-Traded Fund) third tranche of public offer, which was open for a day on Thursday snapped up Rs 46,000 crore in overall collections against the base offer of Rs 3,500 crore, making ETFs yet again an attractive disinvestment vehicle for the government. 

The open-ended ETF consisting of 22 stocks of Central Public Sector Enterprises and private companies held under the SUUTI (Specified Undertaking of the Unit Trust of India), also saw retail investors making 91,000 applications worth Rs 1,500 crore, according to a tweet by Department of Investment and Public Asset Management. “The Government has decided to retain approximately Rs 10,000 crore as its divestment proceeds,” Finance Ministry said in a release.

The issue was made at 5 per cent discount to retail, HNI and institutional investors. Bharat-22’s two offerings — in November 2017 and in June 2018 — were highly sought after, raising Rs 14,500 crore and Rs 8,400 crore respectively.

The ETF, which tracks the S&P BSE Bharat-22 index, has been a hit with investors for the mix of private and public sector firms in the index. Apart from the major public sector units, three private firms have a significant weightage with Axis Bank having 12.23 per cent, ITC 16.45 per cent and L&T 15.91 per cent.