Bengaluru – September 24 2024: Groww Mutual Fund is pleased to introduce the Groww Nifty India Defence ETF, offering investors an opportunity to participate in India’s defence sector. The New Fund Offer (NFO) will be open from 23rd September to 4th October 2024, allowing investors to gain exposure to the companies driving India’s defence industry forward.
India’s defence sector is seeing expansion due to the ₹3 lakh crore production target by FY 20291 and a projected $138 billion investment pipeline over FY24 to FY322. Additionally, the government has set a defence export target of ₹50,000 crore by FY 20293, positioning Indian companies as global leaders in defence manufacturing.
The sector is supported by strong governmental initiatives under AtmaNirbhar Bharat and increasing budget allocations, with the FY 2024-25 defence budget standing at ₹6.22 lakh crore4.
The Groww Nifty India Defence ETF tracks the Nifty India Defence Index, which includes key companies such as Bharat Electronics Ltd. and Hindustan Aeronautics Ltd. The index captures the performance of India’s top defence companies, offering exposure across large-cap, mid-cap, and small-cap segments.
Why is Defence relevant?
India’s defence sector is experiencing growth, driven by:
● Order Books: Companies in the index, like Hindustan Aeronautics Ltd. (HAL), have potentially strong order books. HAL alone has an order book of ₹94,000 crore5, more than three times its FY 2024 revenue, which promises steady cash flows*. All 15 companies in the index show growth in their order books, indicating future revenue potential.
● Domestic Manufacturing Push: The government’s push for domestic manufacturing is opening new opportunities for companies, strengthening India’s self-reliance in defence production.6
● Exports Push: Indian companies are increasingly becoming global leaders in defence, driven by export initiatives. This is expected to position them not only as leaders in India but also on the international stage.7
Key Features of the Groww Nifty India Defence ETF:
● Diverse Exposure8: The ETF offers access to a wide range of companies within the defence sector, including large, mid, and small-cap stocks.
● Long term Growth Potential9: The defence sector is expected to experience rapid growth due to increasing government spending, strong order books, and export opportunities.
● Sector Focus8#: The index includes companies from capital goods and chemicals sectors, which form the backbone of India’s defence manufacturing industry.
Investment Details:
● NFO Period: 23rd September – 4th October 2024
● Minimum Investment: ₹500 and in multiples of ₹1 thereafter
● Exit Load: Nil
● Fund Manager: Mr Abhishek Jain
Investors are encouraged to consult their financial advisors and refer to the Scheme Information Documents (SID) available on the Groww website for further details.
