NFO alert: Groww Mutual Fund files documents to Sebi to float Groww Nifty EV & New Age Automotive ETF FOF

Groww Mutual Fund has filed draft documents with the Securities and Exchange Board of India (Sebi) for launching the Groww Nifty EV & New Age Automotive ETF FOF (Fund of Fund). The new fund offer will generate long-term capital growth by investing in securities that are part of the Nifty EV & New Age Automotive Index.

The benchmark index for this ETF is the Nifty EV and New Age Automotive Index – Total Return Index (TRI). The scheme is categorised as Other Schemes – Exchange Traded Fund (ETF).  The fund will be managed by Abhisek Jain.

The investment team will focus on a top-down approach for interest rate view and sector allocation, combined with a bottom-up approach for security/instrument selection.

Fund allocation

The fund will allocate 95-100 per cent of its assets to equity and equity-related securities of companies engaged in or expected to benefit from electric vehicles and new-age automotive themes. About 0-5 per cent will be invested in money market instruments, debt securities, and units of debt/liquid schemes of domestic mutual funds.

Investment amount

The minimum application amount for a lump-sum purchase will be Rs 500, with increments in multiples of Re 1 for purchases and Re 0.01 for switches. For SIP investments, the minimum application amount will be Rs 1,200, requiring a minimum of 12 SIP instalments of Rs 100 each for the monthly option, and four SIP instalments of Rs 300 each for the quarterly option.

If you wish to redeem within 30 days from the date of allotment 1% exit load will be applicable. After 30 days from the date of allotment no exit load will be applicable.

Nifty EV and New Age Automotive Index
 
The Nifty EV New Age Automotive Index is a curated selection of 33 stocks sourced from the Nifty 500 index. These chosen stocks must be directly linked to the manufacturing and distribution of electric vehicles, new-age automotive vehicles, batteries, components, raw materials, and technology in the industry. Additionally, the combined weightage of stocks from companies involved in producing electric two, three, and four-wheelers, as well as passenger and commercial vehicles (including new-age vehicles), is restricted to a maximum of 40 percent. Furthermore, this index operates with a flexicap mandate, allowing for the inclusion of assets spanning various market capitalisations.

Recently, Mirae Asset Mutual Fund floated the Mirae Asset Nifty EV and New Age Automotive ETF (MNEV), an exchange-traded fund (ETF) that operates on a passive management approach by mirroring the Nifty EV New Age Automotive Index. 

The index is designed to monitor the performance of businesses involved in the electric vehicle (EV) or new-age automotive sector. This specialised ETF focuses on investing in innovative companies within the automobile industry, emphasizing a thematic approach to its investment strategy.