NFO will be open for five days from January 5-10.
The offering aims to provide returns that closely correspond to the total return of the benchmark Nifty Auto index.
Chintan Haria, Head – Product Development & Strategy, ICICI Prudential Mutual Fund, said, “We believe through ICICI Prudential Nifty Auto ETF, investors will be able to tap into the evolving space of the Indian automobile industry. With India being an emerging global hub for auto component sourcing coupled with the Government support for electric mobility, we believe this space is likely to be under the spotlight.”
From an industry perspective, auto is cyclical in nature i.e. it closely follows the various phases of the economic cycle. The profits of the companies that operate in this space rise or fall in line with consumer confidence.
However, this is one industry which boasts of much higher return on capital employed (RoCE) and cash generation compared with other sectors, attributable to good margins and higher asset turnover.