The fifth tranche of CPSE ETF has opened today for subscription by anchor investors, through which the government is looking to raise at least Rs 3,500 crore to meet its disinvestment target for current fiscal.
Non-anchor investors can participate in CPSE ETF from March 20 to March 22, according to Reliance Nippon Life Asset Management Limited, which is managing this ETF.
In the current financial year, this is the second CPSE ETF tranche and overall the fifth tranche since it was launched in 2014.
This is the fifth tranche overall of CPSE ETF — a basket of 11 blue-chip PSUs — and second in this fiscal year itself. Earlier, CPSE ETF’s public offer in November 2018 saw roaring success in November 2018, garnering Rs 17,000 crore from investors.
In order to expedite the disinvestment process, the cabinet on March 7 approved alternate mechanism to decide on the strategic sale of CPSEs. CPSE ETF was launched by the government in 2014, since then, it has so far raised Rs 28,500 crore in four tranches. It raised Rs 3,000 crore from the first tranche in March 2014; Rs 6,000 crore in January 2017; Rs 2,500 crore from the third in March 2017; and Rs 17,000 crore in November 2018 from the fourth tranche.
The CPSE ETF comprises shares of the 11 public sector undertaking companies, namely, ONGC, Coal India, IOC, Oil India, PFC, REC, Bharat Electronics, NTPC, SJVN, NLC and NBCC. Besides, the government has another ETF called Bharat 22 ETF, which was launched in November 2017 in view of its disinvestment plans. It issued third tranche of Bharat 22 ETF in February which got oversubscribed by 14 times, snapping up Rs 46,000 crore against the base offer of Rs 3,500 crore. The government has garnered Rs 56,473.32 crore so far in the current financial year as disinvestment proceeds against the budgeted estimate of Rs 80,000 crore for the financial year ending March 2019.