etf: Fourth tranche of Bharat Bond ETF likely in December

The government is planning to launch the fourth tranche of Bharat Bond ETF, India‘s first corporate bond exchange traded fund, in December, an official said. The funds raised would be utilised for undertaking capital expenditures by public sector enterprises.

“We are currently in discussion with CPSEs and assessing their needs. The issue size for the fourth tranche of Bharat Bond ETF could probably be close to last year’s,” the official told PTI.

In December last year, the government had launched the third tranche with a base issue size of Rs 1,000 crore. It was over-subscribed 6.2 times with bids worth Rs 6,200 crore coming in.

The maiden offering of Bharat Bond ETF was launched in 2019, helping CPSEs raise Rs 12,400 crore. In the second and third tranches, it had raised Rs 11,000 crore and Rs 6,200 crore, respectively. The ETF has raised Rs 29,600 crore in its three offerings so far.

Bharat Bond ETF invests only in ‘AAA‘-rated bonds of public sector companies. Edelweiss Asset Management is the fund manager of the scheme.

Since its launch in 2019, the asset under management (AUM) of the ETF has crossed the Rs 50,000 crore-mark.

Currently, the ETF offers 5 different maturities — 2023, 2025, 2030, 2031, and 2032.

“Our endeavour has been to expand the maturity period to give investors an option to choose the period of investment as per their need. In this tranche too we would look to give investors a new option for choosing the maturity period,” the official added.

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