India's First Auto ETF Introduced By Nippon, Check Dates And Other Details

Nippon India Mutual Fund (NIMF) has announced that they will launch the Nippon India Nifty Auto ETF, which will be India's First Auto ETF for the sector. The Nippon Auto ETF will be an open-ended scheme that will be tracking the Nifty Auto Index.

This New Fund Offer (NFO) will open on January 5, 2022, and it will close on January 14, 2022, being open for 10 days for the investors. Nippon informed that the minimum investment amount required during NFO will be Rs. 1,000. If the investors want to invest more, it will be in multiples of Re. 1 thereafter.

According to Nippon, this Auto ETF will predominantly invest in stocks comprising of the Nifty Auto Index in the same proportion as the Index, which will be providing exposure to Top 15 (as per Nifty Auto Index methodology) companies representing auto-related sectors. The auto sectors will include segments like - Automobiles 4 wheelers, Automobiles 2 and 3 wheelers, Auto Ancillaries, and Tyres. Hence, with the performance of the Indian automobile sector, this auto ETF will reflect its returns, as it will be benchmarked against Nifty Auto TRI.

Commenting on the launch, Hemen Bhatia, Head ETF, Nippon India Mutual Fund said, "Nippon India Nifty Auto ETF is yet another addition to our ETF offerings, helping investors to participate in India's Auto sector growth story through investing in a basket of 15 stocks representing the Nifty Auto Index. Nippon India Nifty Auto ETF which is the first Auto sector ETF to be launched in India will provide a simple and low-cost (in terms of total expense ratio) portfolio building block to participate in the auto sector".

"With most headwinds like supply constraints of semi-conductor along with increasing commodity prices behind us and with the street view moving from fear of electrification to seeing Electric Vehicle (EV) as an opportunity, investors will get exposure to EV theme as well, as part of the overall auto sector exposure. It is an honour to play a critical role in helping so many investors achieve their investment goals," Bhatia added.

The Nippon India Mutual Fund (NIMF) is one of the biggest ETF players in the country, which has an AUM of above Rs. 500 billion as on November 30, 2021, with a market share of 60%. It has one of the most comprehensive ETF bouquets comprising 23 ETFs in the industry across Equities, Debt, and Commodity.