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Quick buck: Bharat 22 ETF gives NFO investors instant profit

The government had offered a 3 per cent discount on issue price to retail investors

Bharat 22 ETF, the unique exchange-traded fund that the government unveiled earlier this month to offload its holding in 22 blue chip firms, made a made a debut on BSE, by listing at Rs 36.30 per unit, a 0.91 per cent premium over its issue price of Rs 35.97 per unit.

This means a retail investor would have made instant profit of at least Rs 7,100 if one had availed the entire limit of Rs 2 lakh available in the retail category during the new fund offer (NFO) period.

The government had offered a 3 per cent discount on issue price to retail investors by allotting some 5,560 units at Rs 35.97 each.

On Tuesday, within minutes of it debut, the ETF traded 3.86 per cent above the issue price at Rs 37.36 per unit. The ETF is managed by ICICI Prudential Mutual Fund, which raised Rs 14,500 crore during the NFO period.

Bharat 22 is a well-diversified open-ended ETF with diversified sectoral representation, including 22.6 per cent weightage to industrials, 20.3 per cent to finance, 20 per cent to utilities, 17.5 per cent to energy, 15.2 per cent to FMCG, and 4.4 per cent to basic materials. ‘

The government offloaded part of its holding in frontline stocks such as SBI, Nalco, ONGC, BPCL, NTPC and Bank of Baroda besides SUUTI shares in listed companies such as ITC, Larsen & Toubro and Axis Bank.

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