A K Capital Services leads race to manage India's first debt ETF

Debt advisory services firm A K Capital Services is likely to manage India's first Debt Exchange Traded Fund (ETF) proposed to be set up for PSUs and public sector banks to raise long terms funds from the market. Two advisory services firms -- Trust Investment Advisors Pvt Ltd and A K Capital Services Ltd -- had made presentations before the Department of Investment and Public Asset Management (DIPAM) on July 13.

Sources said A K Capital Services has emerged as the front-runner for managing the proposed debt ETF. A final approval for the appointment would be accorded by the Finance Minister, they said. As per the company's website, A K Capital Services is the flagship company of the A K Group. Incorporated in 1993, A K Capital Services is one of the country's leading Sebi registered category-I merchant bankers.

DIPAM had in April invited bids from advisors to help create and launch a debt ETF to help PSUs and public sector banks raise funds for capital expenditure. The advisor would be appointed for a period of three years which may be extended by two years. Apart from helping in creating the debt ETF, the advisor would also advise the government in launch and management of first issuance or offerings and post issuance provisions.

Sebi registered merchant bankers or consulting firms having advised or launched an ETF or debt mutual fund or managed issuance of corporate bond of Rs 5,000 crore or more between April 1, 2015 and March 31, 2018 were eligible to bid for managing the debt ETF. The plans to launch a debt ETF was announced by the then Finance Minister Arun Jaitley in his 2018-19 Budget speech.