The Rs 6,000-crore further fund offer (FFO) of the Central Public Sector Enterprises exchange-traded fund or CPSE ETF is relying on investments by retirement funds. Both private and the Employees' Provident Fund Organisation (EPFO) are expected to apply in the second tranche of the fund, which opens for subscription on Tuesday. “Such a high amount has hardly ever been raised through new or further fund offer. The participation of pension funds will be critical,” said a person close to the development. The Employees’ Provident Fund’s recent doubling of equity investment limit to 10 per cent on incremental corpus is expected to come in handy. Such funds are allowed to take equity exposure only through certain ETFs, including the CPSE ETF.
Chandan Kishore Kant
BSE shares gain traction in grey market
Shares of the BSE, Asia’s oldest bourse, have moved up 6.5 per cent to Rs 810 in the past two weeks in the grey market. Shares were trading at around Rs 760 after the consolidation of shares at a face value of Rs 2 on December 22. The exchange is expected to hit the market with its initial public offering (IPO) later this month with a likely price band of Rs 800-850. Although the price band is yet to be disclosed, BSE shares are widely expected to list at a premium of Rs 90-100 over the issue price.
Big fund houses want more choice in short-term funds
Leading fund houses want more options for market-savvy investors at the short end of the mutual fund (MF) schemes. In a recent meeting of the Securities and Exchange Board of India’s advisory committee on MFs, representatives of top fund houses proposed that they should be allowed to launch variants like duration and credit-risk schemes in short-term funds. However, there was opposition from some members of the committee who said short-term schemes like liquid funds and ultra short-term funds were used by companies and investors to park their money, not for higher returns at the cost of credit risk. Industry sources say the market regulator, also, may not been too keen on allowing such products.