India

Tata Mutual Fund launches Tata Nifty India Digital Exchange Traded Fund

Tata Mutual Fund launches Tata Nifty India Digital Exchange Traded Fund - an Open-Ended Exchange Traded Fund replicating / tracking Nifty India Digital Index

Speaking on the launch, Meeta Shetty, Senior Analyst & Fund Manager, Tata Mutual Fund said, “Tata Nifty India Digital Exchange Traded Fund is a passive portfolio replicating a predefined Digital India Index. Current characteristics of Nifty India Digital Index based on its index construction methodology represents the digital change agent companies and digital enablers. Digital transformation is still in the early stages and we expect more new age companies to achieve scale, raise capital and get listed over the next 3-5 years. As this transformation unfolds and the new age companies become a more prominent part of the economy and equity markets, we see the emergence of new hybrid segments like consumer tech, fintech, edtech, etc. The portfolio, over a period, would have adequate representation to Digital enablers as well i.e. IT Services/ Cloud transformation / SaaS companies. The Indian IT services companies which are ahead in digital and cloud capabilities will also be an important part of this segment along with companies which are in the automation/robotics/IoT space”.

“As a result of the structure of the index, we believe that the Tata Nifty India Digital Exchange Traded Fund will be able to leverage on the evolving digital scenario in the long term”

 

Commenting on the launch Anand Vardarajan, Business Head – Banking, Alternate Products & Product Strategy said that “The digital layer is getting added in almost all industries and we have seen that it can support the traditional businesses very well. In some cases, we are also seeing digital front displacing the traditional business. Digital is a very interesting space, although it is still evolving, especially the platform companies. We believe, this segment will see its own set of winners and losers but the winners here can be multi-year growth opportunities and being asset-light models, these companies can also generate higher ROEs in the longer run. Through Nifty India Digital Index we aim to capture the growth of these digital companies.”

 

“Our existing offering Tata Digital India Fund is largely inclined towards digital enablers i.e. large and mega IT services companies into cloud transformation and data analytics. With more equity market company listings and inclusion of the same in the Nifty Digital Index basis the predefined methodology of the Index constructor NSE, the share of new-age digital companies would tend to increase, thus increasing the pie of alpha generators vis a vis steady compounders”