21-05-2025
Nippon Life India AM Unveils Two New Passive Funds Targeting Emerging Large-Caps
Both funds aim to provide cost-effective, rules-based, and diversified exposure to India's next-tier large-cap companies—those ranked just beyond the top 30 BSE Sensex constituents.
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Nippon Life India Asset Management Limited (NAM India), one of India's leading asset managers, has announced the launch of two innovative open-ended passive investment offerings: the Nippon India BSE Sensex Next 30 Index Fund and the Nippon India BSE Sensex Next 30 ETF.
Both funds aim to provide cost-effective, rules-based, and diversified exposure to India's next-tier large-cap companies—those ranked just beyond the top 30 BSE Sensex constituents.
These funds are built on the BSE Sensex Next 30 Index, a benchmark that spotlights 30 large-cap companies often overlooked in traditional large-cap portfolios. This segment presents a unique opportunity to invest in potential future blue-chip companies across 12 sectors.
Arun Sundaresan, Head of ETFs at NAM India, stated, "The 'Nippon India BSE Sensex Next 30 ETF' and 'Nippon India BSE Sensex Next 30 Index Fund' are strategic additions to our passive product suite. These schemes provide access to a lesser-explored segment of large caps with strong potential through a low-cost, passive approach. As Indian equity markets evolve and broaden, these funds offer investors a unique avenue for diversification and long-term wealth creation."
Key highlights of the Index Fund include exposure to under-represented large caps, sectoral diversification, and reduced non-systematic risk due to its rules-based structure. The ETF, meanwhile, offers the added advantage of real-time trading flexibility during market hours and cost-efficient access to this differentiated basket.
The New Fund Offer (NFO) for both schemes opens on May 21, 2025, and closes on June 4, 2025, with a minimum investment of INR 1,000.
Backed by data, the BSE Sensex Next 30 TRI has outperformed major large-cap indices with an impressive 5-year CAGR of ~26%, compared to ~20% for the BSE Sensex TRI. It has delivered positive returns in 9 out of the last 11 years, and is currently trading at a 7% discount to its 10-year historical average P/E, making it an attractive entry point.
NAM India, with over INR 1.93 lakh crore in passive AUM and a robust suite of 24 ETFs and 26 index funds, continues to fortify its leadership in the passive investing space, offering tailored solutions for a growing investor base seeking diversification and long-term growth.
