• Two new series of BHARAT Bond ETF will be launched on July 14, 2020
  • Rs 3,000 crore is the base issue size with further green shoe option of Rs 11,000 crore
  • 25% reserved for Retail investors and 75% for Retirement Funds, QIBs and Non-Institutional Investors
  • NFO period between July 14 and July 17, 2020

Chennai, NFAPost: Edelweiss Asset Management has announced the launch of the second tranche of BHARAT Bond ETF in July, with two new series, after the successful launch of the initial series of ETFs in December 2019.

The BHARAT Bond ETF program is an initiative of the Government of India, from the Department of Investment and Public Asset Management and the latter has given the mandate to Edelweiss AMC to design and manage the product.

The two new Bharat Bond ETF series will have maturities of April 2025 and April 2031. NFO will start from July 14, 2020 and end on July 17, 2020. Through the launch of these two new ETF series, Edelweiss Mutual Fund proposes to raise an initial amount of Rs 2,000 crore with a green shoe option of Rs 6,000 crore in 2025 Maturity and initial amount of Rs 1,000 crore with a green shoe option of Rs 5,000 crore in 2031 Maturity based on market demand.

The ETF will invest in constituents of the NIFTY BHARAT Bond Indices, consisting of AAA rated public sector companies. BHARAT Bond Fund of Funds (FOF) with similar maturities will also be launched for investors, who do not have demat accounts.

Edelweiss group Chairman and CEO Rashesh Shah said, “The first launch of BHARAT Bond ETF was highly successful and since then it has seen healthy growth in AUM and good liquidity on exchange. We hope that the BHARAT Bond ETF program achieves its ultimate objective of creating a liquid yield curve for CPSE bonds and helps further agenda of development of bond markets.”

“We believe that the BHARAT Bond ETF program will keep growing and will provide a safe and secure investment avenue for investors and an easy way for CPSEs to raise funds,” he added.

EAML is a part of the Investment & Advisory business of Edelweiss Group. EMAL remains one of the fastest growing and youngest AMCs in India, with an AUM of Rs 24,471 crore.  It offers a robust platform to a diversified client base across domestic and global geographies.

DIPAM, Ministry of Finance, Secretary Tuhin Kanta Pandey, said, “BHARAT Bond ETF program has achieved some important objectives that were envisioned while creating the blueprint of this program. It has provided aggregate savings in borrowing cost for participating CPSEs/CPSUs/CPFIs. It has provided easy access to investors into Bond markets and adequate Liquidity on exchange with low bid-ask spreads, this will encourage investor participation and help in developing bond markets further.”

He added that the organic increase in AUM of existing BHARAT Bond ETFs even during these uncertain times resembles investors building confidence with the product. In upcoming issue, we expect to raise anywhere between Rs 3,000 crore and Rs 14,000 crore. This will help CPSEs in their capex programs in coming months.”

NSE MD and CEO Vikram Limaye said the new BHARAT Bond ETF tranches maturing in 2025 and 2031 will provide more investment choices to fixed income investors.

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