Four merchant bankers ICICI Securities,Citibank,SBI Capital Markets and Yuanta Funds have been shortlisted by the department of disinvestment (DoD) for making presentations on setting up of ETF of public sector undertakings before an inter-ministerial group on Thursday.
However,the exchange traded fund (ETF) of PSU is unlikely to be launched before February next year,putting further pressure on the governments collection from stake sale proceeds.
One of them will be selected to act as an adviser for the ETF. A decision will be taken by the month end, a government official said.
The adviser would be expected to finalise the structure of the fund and also select the public sector firms who would be a part of the fund.
Its a long and complicated process. We will have to discuss the plan with the concerned PSUs and also take approval from the Cabinet Committee on Economic Affairs, the official said adding that the ETF would be launched earliest by February next year.
The finance ministry is banking on the ETF to help raise a part of the budgeted Rs 30,000 crore from disinvestment proceeds this fiscal.
The DoD is planning to model the fund on the lines of the Hong Kong Tracker Fund with a corpus of about Rs 5,000 crore.
The ETF would consist of stocks of only those listed PSUs that are actively traded,and would comprise firms across different sectors.
The proposed CPSE-ETF will serve as an additional mechanism for the government to monetize its shareholdings in those CPSEs that will eventually form part of the ETF basket, the disinvestment department has said.