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    ICICI Prudential's Nifty Auto Index Fund opens for subscription: Key things to know

    ICICI Prudential's Nifty Auto Index Fund opens for subscription: Key things to know

    ICICI Prudential's Nifty Auto Index Fund opens for subscription: Key things to know
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    By CNBCTV18.com  IST (Updated)


    From fund details to auto index performance, here's everything you need to know about this new fund offer (NFO)

    ICICI Prudential Mutual Fund’s Auto Index Fund has opened for subscription today. This new fund offer (NFO) will be available till October 6, 2022. This is an open-ended index scheme replicating Nifty Auto Index and will give investors an opportunity to earn from the expected growth in the automobile sector, including the EV segment.
    In a statement, ICICI Prudential Mutual Fund said this is India’s first Auto Index Fund which will try to replicate the Nifty Auto Index that has grown at over 14 percent annually since August 2012.
    About the Index
    The Nifty Auto Index is designed to reflect the behavior and performance of the automobile segment of the financial market. The universe for the offering is Nifty 500. No single stock shall be more than 33 percent and weights of top 3 stocks cumulatively shall not be more than 62 percent at the time of rebalancing. The index is rebalanced semi-annually in March and September respectively, the company said.
    Index Performance
    Nifty Auto TRI has outperformed Nifty 50 TRI 7 times till August 31, 2022.
    (Source: ICICI Prudential Mutual Fund. Data as on August 30, 2022)
    Nifty Auto Index has grown at 14.21 percent annually since August 2012. This means that Rs 1,00,000 invested in the Nifty Auto Index in 2012 would be worth Rs 3,77,713.6 by end of August 2022.
    SIP returns (%)
    Taking SIP amount as Rs 1,000
    (Source: ICICI Prudential)
    Key things to know before investing in the NFO
    According to ICICI Prudential Mutual Fund, investors can consider ICICI Prudential Nifty Auto Index Fund due to following reasons:
    • Rising individual income has the potential to grow and boost the auto industry.
    • The EV market is expected to grow at a CAGR of 49 percent between 2022-2030 and is expected to hit 10 mn-unit annual sales by 2030.
    • The Government aims to develop India as a global manufacturing center and a Research and Development (R&D) hub.
    • Under NATRiP, the Government of India is planning to set up R&D centers at a total cost of US$ 388.5 million to enable the industry to be on par with global standards.
    • Skilled labour at low cost, robust R&D centres, and low-cost steel production provide great opportunities for investment.
    • Auto exports have begun to rise.
    • The Sector is cyclical in nature and the ICICI Prudential Nifty Auto Index Fund aims to perform when opportunities arise and market demand rises.
    • Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!
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