Second tranche of Bharat Bond ETF to launch in July, says Edelweiss Asset Management

The second tranche of Bharat Bond exchange-traded fund (ETF) will be launched in July, said Edelweiss Asset Management on Friday. This comes after the successful launch of the initial series of the ETF in December 2019.

The second tranche of the ETF will be launched with two new series of 5-year and 11-year bonds and plans to raise up to Rs 14,000 crore, Edelweiss added.

Through the launch of the two new ETF series, Edelweiss Mutual Fund proposes to raise an initial amount of Rs 3,000 crore with a green shoe option of Rs 11,000 crore based on market demand, the fund house said in a statement.

"The launch is in line with our vision to create a ladder of Bharat Bond ETFs across various maturities on the yield curve. This will provide more options for investors to match their investment needs with different time horizons, Radhika Gupta, CEO of Edelweiss Mutual Fund said.

The first tranche was also issued by Edelweiss Asset Management and listed on the NSE on January 1, 2020. It was subscribed 1.7 times, accumulating Rs 12,000 crore against its base size of Rs 7,000 crore.

The exchange-traded fund will invest in AAA-rated bonds of public sector companies and will have target maturity structures. The two new series will have maturities of April 2025 and April 2031.

Bharat Bond Funds of Funds (FOF) with similar maturities will also be launched for investors, who do not have demat accounts, the fund house added.