Edelweiss Mutual Fund to launch third tranche of Bharat Bond ETF

The new fund offer (NFO) will start from 3 December and end on 9 December 2021. Through the launch of this new series, Edelweiss Mutual Fund proposes to raise an initial amount of ₹1,000 crore with an open green shoe option.

Edelweiss Bharat Bond ETF assets under management (AUM) stood at ₹36,359 crore at the end of October 2021. Edelweiss Bharat Bond ETF kicked-off the passive debt category in India in December 2019. Post the launch of Edelweiss MF Bharat Bond ETF in 2019, the total AUM for passive debt category has grown to around ₹50,000 crore.

As per the fund house, since then, various other asset management companies (AMCs) have launched nine new schemes in this category, but Edelweiss has been successful in retaining its leadership position with 80% market share.

Commenting on the launch, Radhika Gupta, chief executive officer, Edelweiss Mutual Fund, said, “With this new launch of Bharat Bond ETF, we now have five maturities on the yield curve–2023, 2025, 2030, 2031 and 2032—which will help investors to choose the right maturity according to their needs. We are happy to see a healthy demand from investors for these ETFs in the current environment where safety is paramount.”

The ETF will invest in constituents of the Nifty Bharat Bond Indices, consisting of AAA-rated public sector companies. BHARAT Bond Fund of Funds (FoF) with similar maturities will also be launched for investors, who do not have Demat accounts.

“Bharat Bond ETF program has achieved some important objectives that were envisioned while creating the blueprint of this program. It has provided aggregate savings in borrowing cost for participating CPSEs/CPSUs/CPFIs. It has provided easy access to investors into bond markets, especially retail investors who are looking alternative to fixed deposit. Further, adequate Liquidity on the exchange is encouraging investor participation and helping in deepening the bond markets,” said Tuhin Kanta Pandey, Secretary, DIPAM, Ministry of Finance said.