Aditya Birla adds Nifty IT ETF to its passive portfolio

Aditya Birla Sun Life Mutual Fund (ABSLMF) has announced the launch of its Aditya Birla Sun Life Nifty IT ETF, which is an open-ended exchange-traded fund (ETF) that aims to track the Nifty IT Total Return Index (TRI).

The Nifty IT index is predominantly a large-cap index that acts as a benchmark for the performance of the Indian IT sector and comprises 10 marquee IT companies listed on the National Stock Exchange (NSE). Its base date is January 1, 1996, and is calculated using the free-float market capitalization method. The index is rebalanced every quarter and no single stock possess more than 33 per cent weightage and the collective weightage of the top three stocks is not to be more than 62 per cent at the time of rebalancing. Interestingly, Nifty IT TRI has outperformed broad-based indices across periods.

According to reports, India is projected to have 90 crore active internet users by 2025. The growth is witnessed in all the pockets, right from e-commerce and fintech to cloud computing and social media. Moreover, the adoption of new-age technologies is expected to boost India's annual growth rate by 1.3 per cent by 2035.

On launch, A Balasubramanian, Managing Director and CEO, Aditya Birla Sun Life AMC Limited said, “Over the years, India has established itself as a preferred destination for IT and Business Process Management services, with the sector contributing almost 44 per cent of FDI inflows in India in 2021 (Source: Gartner, Indian Brand Equity Foundation (IBEF) / As on August 2021). It is estimated that the Indian IT sector has the potential of becoming a USD 350 billion industry in annual revenues by 2025 as per a report by Nasscom. The Government is also incentivising the sector by not only fast-tracking the Digital India initiative but also introducing schemes like MeitY, SAMRIDH and PLI. All this will significantly benefit the sector.”

He further adds, “Amid the pandemic, the sector demonstrated its defensive nature by reporting strong business growth, and also gave stellar returns. With India being on track to become a Global Hub of IT, Aditya Birla Sun Life IT ETF allows investors to tap into the growth potential of the top IT companies.”

The New Fund Offer (NFO) opens for subscription today (October 20, 2021) and closes on October 28, 2021.