Mumbai: State Bank of India Mutual Fund aims to collect Rs1.5-2 billion from its new gold Exchange Traded Fund (ETF), a senior official said on Monday.
“Based on the current market situation, our current expection is that in the initial stage we should probably do about Rs150-200 crores,” R.S. Srinivas Jain, chief marketing officer with SBI Mutual Fund, told reporters at the launch.
“And over the period of time we should be a substantially large fund,” Jain added.
The new fund offering will close on 28 April.
SBI MF will join the five other gold ETFs traded on the National Stock Exchange. India’s gold collection under exchange-traded funds rose 32.8% to 5.172 tonnes in the year to February-end, data from the funds showed.
Though gold collections under ETFs are growing, they remain miniscule against India’s imports of about 700 tonnes annually.
Gold ETFs — instruments that can be traded like shares and are backed by physical gold holdings — are more than a year old and the segment may get crowded with some other funds planning to enter.