Mutual Funds - Reports
25-Nov-2024 16:42
Tata MF launches index fund tracking India's leading conglomerates
The investment objective of the scheme is to provide returns, before expenses, that commensurate with the performance of BSE Select Business Groups Index (TRI), subject to tracking error. The minimum investment amount is Rs 5,000, with subsequent investments in multiples of Re 1. An exit load of 0.25% of the applicable NAV applies if redeemed on or before 15 days from the date of allotment.
The index features 30 companies from seven of India's leading business groups across 19 industries. The business groups represented in the index include the Tata Group, Reliance Industries, Adani Group, Aditya Birla Group, L&T, Jindal Group, and Mahindra Group. Each group's weight is capped at 23% based on free-float market capitalization, ensuring balanced exposure.
The fund is designed to tap into growth-oriented sectors such as electric vehicles, green energy, artificial intelligence, quantum computing, and defense'industries expected to drive India's future growth path.
The BSE Select Business Groups Index (TRI) selects 30 constituents from the largest 7 business groups in India, based on their free-float market capitalization. These stocks are chosen from the BSE 500 universe.
The largest company in each group, based on a 6-month average free-float market capitalization, is automatically selected. The remaining 23 companies are then ranked by their 6-month average free-float market capitalization and added to the index. Financial services companies are excluded from the index. Additionally, both group and individual stock weightings are capped at 23%. The index is rebalanced semi-annually.
During the reconstitution process, existing groups will remain in the index as long as they stay within the top 8 business groups by free-float market capitalization. However, if a new group enters the top 4, it will be added to the index, and the lowest-ranked existing group will be removed.
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