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BIZ-CPSE-ETF


PTI kolkata Last Updated at 27-11-2018 12:14:30 IST India

The government is considering

exercising greenshoe option worth Rs 4,000-6,000 crore in the

Central Public Sector Enterprises - Exchange Traded Fund (CPSE

ETF FF03) over the base issue size of Rs 8,000 crore.

CPSE ETF, which works like a mutual fund scheme, is an

instrument with which the government divests its stake in the

CPSEs without hitting the secondary market directly with

individual PSUs.

"The base issue size in the fourth round of CPSE ETF

issue is Rs 8,000 crore and this time a greenshoe option has

been kept which may be between Rs 4,000 crore and Rs 6,000

crore. However, the government is yet to decide on this,"

Reliance Nippon Life AMC Co-Chief Business Officer Saugata

Chatterjee said.

Reliance Nippon Life AMC is the manager of the fourth

tranche of the CPSE ETF.

The target amount is the highest compared to the three

previous issues of the ETF.

In the new fund offer (NFO) in 2014, the issue size

was Rs 3,000 crore, the first Further Fund Offer (FFO1) size

was Rs 6,000 crore in January 2017 which was followed by

another FFO2 issue in March 2017 that raised just Rs 2,500

crore.

However, there were no over-allotment option due to

which the asset management company (AMC) had to refund the

excess application.

Discount offer of 4.5 per cent has been decided in

this issue against 2.5 per cent in the previous issue of March

2017.

Out Rs 80,000 crore target from divestment in 2018-19,

the Centre has been able to achieve only Rs 15,247 crore,

latest data showed.

Chatterjee says he is hopeful of large scale

participation in the issue that opens for anchor investors on

November 27 and for retail investors on November 28 despite

liquidity crunch triggered by the IL&FS default.

He said in current issue, the composition has changed

where NTPC, SJVN and NBCC made entry while, Concor, EIL Ltd

and GAIL made exit.

The total number of stocks now stands at 11 compared

to 10 in the earlier three issues.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


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