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CPSE ETF receives bids worth Rs 9,200 crore from anchor investors

The base issue size is of Rs 10,000 crore with a greenshoe option to retain a portion of the oversubscription.

January 30, 2020 / 10:29 PM IST

The seventh tranche of CPSE ETF was lapped up by institutional investors on Thursday, with the portion reserved for anchor investors getting subscribed more than three times to the tune of Rs 9,200 crore. The government has launched seventh tranche of CPSE Exchange Traded Fund (ETF), comprising shares of 11 state-run companies, to raise up to Rs 10,000 crore from the market.

The base issue size is of Rs 10,000 crore with a greenshoe option to retain a portion of the oversubscription.

As much as 30 per cent of the total base issue size, or Rs 3,000 crore, was reserved for anchor investors who put in bids worth Rs 9,200 crore, DIPAM Secretary Tuhin Kanta Pandey said in a late evening tweet.

He further said that robust participation has been received from domestic and foreign investors.

The issue will open for other institutional and retail investors on Friday.

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The decision to launch sixth FFO (further follow on offer) or seventh tranche of CPSE ETF was taken after the government received robust response for earlier stake sale in the product.

The government has already raised about Rs 50,000 crore through six tranches of CPSE ETF earlier -- Rs 3,000 crore from first tranche in March 2014, Rs 6,000 crore in January 2017, Rs 2,500 crore from third tranche in March 2017, Rs 17,000 crore in November 2018, Rs 10,000 crore in March 2019 and Rs 11,500 crore in July 2019.

Nippon Life India Asset Management, formerly known as Reliance Nippon Life Asset Management, which has been mandated to manage CPSE ETF on behalf of the government, had earlier this month filed 'scheme information document' for sixth FFO of CPSE ETF with markets regulator Sebi.

CPSE ETF tracks shares of 11 CPSEs (Central Public Sector Enterprises) -- ONGC, NTPC, Coal India, IOC, REC, PFC, Bharat Electronics, Oil India, NBCC India, NLC India and SJVN.

The proceeds from ETF will help the government meet its disinvestment target of Rs 1.05 lakh crore for the current financial year.
PTI
first published: Jan 30, 2020 10:28 pm

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