You can expect more CPSE ETFs in 2017

You can expect more CPSE Exchange Traded Funds (ETFs) in 2017. Against the backdrop of a successful listing of CPSE ETF this week, the finance minister said Exchange Traded Funds or ETFs are likely to remain preferred investment vehicle for divestment purpose. "A new ETF with diversified CPSE stocks and other government holdings will be launched in 2017-18," the minister said.

The Reliance MF CPSE (Central Public Sector Enterprises) ETF (Exchange Traded Fund) was listed yesterday. It was quoted at Rs 27.85 during the intraday trade. It translates into a gain of 9.25 per cent in 10 days.

The Further Fund Offer (FFO) of CPSE ETF had a size of Rs 4,500 crore, with an option to retain another Rs 1,500 crore in case of oversubscription. The government offered a discount of 5 per cent for retail investors.


CPSE ETF was first launched in March 2014 by Goldman Sachs Asset Management India. The inaugural issue had raised Rs 4,300 crore against a target of Rs 3,000 crore.

The second tranche was handled by Reliance Mutual Fund, which operates the ETF after it bought over Goldman's mutual fund business in the country in 2015.