CPSE ETF receives bids worth Rs 6,072 cr from anchor investors

CPSE Exchange Traded Fund Tuesday received bids worth Rs 6,072 crore from as many as 16 anchor investors, with the portion getting subscribed nearly 6 times, sources said. The fifth tranche of the CPSE ETF opened for subscription Tuesday, wherein the government seeks to raise at least Rs 3,500 crore. CPSE ETF anchor book has been subscribed 5.78 times against the anchor base issue size of Rs 1,050 crore, sources said. The ETF has received applications worth Rs 6,072 crore, they added.

The portion not exceeding 30 per cent of the maximum amount to be raised shall be available for allocation to anchor investors. The list of anchor investors include BNP Paribas Arbitrage, Citi Group Global Markets Mauritius Pvt Ltd, Credit Suisse Singapore Ltd, Edelweiss Alpha Fund, ICICI Prudential Balanced Advantage Fund, Merrill Lynch Markets Singapore Pte Ltd, and Morgan Stanley (France) S.A., among others.

The fourth Further Fund Offer (FFO) will close on March 22, helping the government mop up funds towards meeting its disinvestment target of Rs 80,000 crore for the current fiscal ending March 31.

Non-anchor investors, including retail investors, can put in their bids from Wednesday.

This is the second CPSE (Central Public Sector Enterprises) ETF FFO in the current fiscal after Rs 17,000 crore raised in November 2018.

So far, the government has raised a total of Rs 28,500 crore from rounds through CPSE ETF, including the first offer in March 2014 that mopped up Rs 3,000 crore. Reliance Mutual Fund is managing the CPSE ETF.

The ETF tracks shares of 11 CPSEs -- ONGC, NTPC, Coal India, IOC, Rural Electrication Corp, Power Finance Corp, Bharat Electronics, Oil India, NBCC India, NLC India and SJVN.

After raising Rs 3,000 through New Fund Offer (NFO) in March 2014, the government garnered Rs 6,000 crore from the first FFO of the CPSE ETF in January 2017. Subsequently, Rs 2,500 crore was mopped from the third tranche in March 2017 and Rs 17,000 crore from the fourth round in November last year.

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The government raised Rs 56,473.32 crore through disinvestment till the end of February, as against the target of Rs 80,000 crore for the 2018-19 fiscal.