Tata Asset Management Launches Tata Nifty Capital Markets Index Fund Tapping into India's Expanding Financial Ecosystem

(MENAFN- Adfactors PR) Bengaluru, October 8, 2024: Tata Asset Management Company, a pioneer in the mutual fund industry, has launched the country's first index fund based on the newly launched Nifty Capital Markets Index. The Tata Nifty Capital Markets Index Fund will track the performance of stocks from the Nifty 500 Index that are relevant to the capital market theme. The index includes companies from financial services verticals such as, asset management companies, exchanges and data platforms, stockbroking and allied services, depositories, clearing houses, financial products distributors, ratings, and other capital market-related services.
This open-ended index fund has been meticulously designed to provide investors with exposure to fastest growing companies from India's robust capital market. The companies forming the index have benefitted from evolving investment needs, increase in the number of retail investors and sustained capital inflows from domestic and foreign institutional investors.
At the launch of the index fund, Anand Vardarajan, Chief Business Officer at Tata Asset Management said, “India's capital markets have been on a remarkable growth trajectory over the past few years. Bolstered by strong investor confidence and robust economic momentum, more individuals are turning to mutual funds and direct equities to participate in potential wealth creation journey. We have seen a massive surge of growth in demat accounts which now stands close to 16 crs. The mutual fund industry's AUM surpassed the INR 65-lakh crore mark in August 2024. In the last decade MF industry AUM has moved 6.5 times from nearly INR 10 Tn to 65 Tn. That having said, India's MF AUM-to-GDP ratio stands at just 16%—well below the global average of 74%—highlighting significant potential for future growth.* Growing population and rising income level is also leading to a surge in HNI investors which are being catered by broking and wealth management outfits to meet their investment needs. This has led to growth of entire capital market ecosystem comprising of broking, depository, exchanges, RTAs and so on.
*Source: Jefferies, ChoiceIndia, ETOnline.
“Financialisation of savings have been big trigger and increasingly investors are looking to move to stocks and mutual funds. In addition to rising household incomes driving greater allocations towards financial assets, India's capital market ecosystem is benefiting from powerful tailwinds. High smartphone penetration, coupled with the government's significant investments in digital public infrastructure such as UPI and Aadhaar, have enabled rapid investor onboarding and heightened engagement. This digital transformation is paving the way for broader participation and deeper integration into the capital markets”
Index Methodology:
Tata Nifty Capital Markets Index Fund that can comprise of maximum top 20 stocks adheres to stringent criteria to ensure optimal representation of all segments pertaining to capital market businesses, with a maximum stock level capping limit of 20% in the index. This index can house a maximum of 20 stocks from the parent index Nifty 500. With a focus on diversification and risk management, the index constituents are weighted basis free-float market capitalization.
In terms of performance, the index has delivered a robust 112.64% return over the past year and a 32.95% compounded annual growth rate (CAGR) over the past 5 years.*
*Source: NSE
Stock selection parameter:
Industry Latest Portfolio as on September 30, 2024
Exchange and Data Platform 34.80%
Asset Management Company 23.99%
Depositories Clearing Houses and Other Intermediaries 21.54%
Stockbroking & Allied 17.14%
Financial Products Distributor 2.55%
The launch of the index fund caters to the evolving need of our investors and provides access to promising segment poised for potential growth in the Indian economy.
The scheme will endeavour to minimize the tracking error by:
• Rebalancing of the portfolio
• Setting off incremental subscriptions against redemptions
• Fast track in expediting in deployment of cash
• Maintaining low levels of cash

Enclosed below are the details about the Tata Nifty Capital Markets Index Fund:
Scheme Name Tata Nifty Capital Markets Index Fund
NFO Period 7th October, 2024 to 21st October, 2024
Scheme re-opens on or before 30th October, 2024
Investment Objective The investment objective of the scheme is to provide returns, before expenses, that commensurate with the performance of Nifty Capital Markets Index (TRI), subject to tracking error. However, there is no assurance or guarantee that the investment objective of the scheme will be achieved. The scheme does not assure or guarantee any returns
Type of Scheme An open-ended scheme replicating / tracking Nifty Capital Markets Index (TRI)
Fund Manager Kapil Menon
Benchmark Nifty Capital Markets Index (TRI)
Min. Application Amount Rs 5,000/- and in multiple of Re.1/- thereafter
(During NFO)
Load Structure Entry Load: Not Applicable (Pursuant to provision no. 10.4.1.a of SEBI Master Circular on Mutual Fund dated May 19, 2023, no entry load will be charged by the Scheme to the investor)
Exit Load: 0.25 % of the applicable NAV, if redeemed on or before 15 days from the date of allotment.
Exit load (if any) charged to the unit holders by the Mutual Fund on redemption (including switch-out) of units shall be credited to the scheme net of Goods & Services Tax. Goods & Services Tax on exit load, if any, shall be paid out of the exit load proceeds.

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