The third tranche of the BHARAT Bond Exchange Traded FundETF will be launched by Edelweiss Asset Management, which invests in the constituents of the Nifty BHARAT Bond Indices, which comprises AAA rated public sector companies.
The mandate to manage the bond is given to the Edelweiss Mutual Fund, a government initiative through the Department of Investment and Public Asset Management.
The ETF is expected to raise 1,000 crore as the base issue size with an additional green shoe option, as it has a maturity date of April 15, 2032. As of October 30, 2021, the total assets under management AUM of the BHARAT BondETF stood at 36,359 crore.
The BHARAT Bond Fund of Funds with similar maturities will be launched for investors who don't have a demat account. Individuals need a demat account to trade in the ETFs.
The BHARAT Bond ETF program has achieved some important objectives that were envisioned while creating the blueprint for this program. The aggregate savings for participating CPSEs CPSUs CPFIs have been provided by the aggregate savings in borrowing cost. It has been easy to find investors into bond markets, especially retail investors who are looking for alternative to fixed deposit, said Tuhin Pandey, Secretary, DIPAM, Ministry of Finance.
In a similar context, Radhika Gupta, CEO, Edelweiss Mutual Fund, highlighted the fact that around 20 new passive debt funds have been filed and nine passive debt funds have already been launched by different mutual fund houses after the launch of the BHARAT Bond ETF in 2019.
The demand for these ETFs is positive and we are happy to see a healthy demand from investors for these ETFs in the current environment where safety is paramount, said Gupta.
The new fund offer will start on December 3, 2021 and end on December 9, 2021.