ETF Securities India study tour to explore dynamics of world’s 5th largest economy

Feb 25, 2020

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25 February 2020 - ETF Securities India study tour to explore dynamics of world’s 5th largest economy

ETF Securities is kickstarting the year with an exploratory tour to India, along with a group of leading financial advisers, to better understand the growth opportunities within the Indian economy.

Led by Kanish Chugh, co-Head of Sales, ETF Securities, the group which includes seven financial planners from six Australian financial planning firms will visit India from 3-6 March.

“It is not common for an ETF provider such as us, who only has passive funds, to do a study tour to explore overseas markets. However, we believe in seeking out intelligent alternatives to create new funds and find a way to provide clients and investors greater insight into the exposure. We are taking a page out of the active managers book and applying it in the passive world.

“It is now a well-established fact that more and more ETF investors are attracted towards global equity portfolios. Given this backdrop, it makes it difficult to ignore India when it is tipped to grow to be the 3rd largest economy within a decade.

“The genesis of this tour came about as we witnessed a surge of interest in our ETFS Reliance India Nifty 50 ETF (ASX code: NDIA) which was launched last year as the first Indian-focused ETF on the ASX.

“This prompted us to dig deeper and get more on ground knowledge of not only how the Indian market operates but also look behind the scenes of innovative companies listed on Nifty50, one of the most traded indexes in the world, so we can feed the knowledge and insights back to our clients and investors.

“India has started 2020 with positive signs of economic recovery, after a slowdown period.”

They include:

  1. Manufacturing PMI: In the third month of expansion, the manufacturing PMI increased to 55.30 points which is near an 8-year high level on the back of the increased new business, output, exports, input buying, and employment.

  2. Services PMI: The largest portion of the Indian economy – service sector – has also started to show the signs of revival. PMI rose to a five-month high of 53.3 in December 2019, easily beating market expectations of 51.4.

  3. Non-financial indicators: 11 of the 16 non-financial indicators such as the output of passenger vehicles, commercial vehicles, motorcycles, Coal India Limited, refinery output, etc have improved on-year in Q3 FY2020, compared to the previous quarter.

  4. Agriculture growth: The first advance estimates of 2019-20 of the area and production of various horticulture crops released earlier this month expect the production to rise.

  5. Higher FDI: Even amid political instability and economic slowdown, FDI in the first half of the current financial year surged 17 per cent on-year to Rs 1.8 lakh crore from Rs 1.5 lakh crore. Rating agency Credit Ratings said there are expectations of further inflows in the FDI investment

as India continues to remain one of the favoured destinations for the investment by foreigners. It added that in the second half of FY20, FDI equity inflows are estimated to the tune of around USD 25 billion.

Notes

The ETFS Reliance India Nifty 50 ETF is designed as a convenient, efficient and transparent way to access

the upper echelons of the Indian stock market.

The Fund aims to provide investors with exposure to the 50 largest Indian companies by market

capitalisation that are listed on the National Stock Exchange (NSE). It accounts for 13 sectors representing

about 66.8% of the free float market capitalisation of the stocks listed on the NSE. Among the companies

included in the Nifty50are HDFC Bank, Tata Consultancy Services, Housing Development Finance Corp,

Reliance Industries and Hindustan Unilever.