India’s life expectancy is estimated to cross 70 years by 2022. This means that we need more healthcare services in the days to come. Government initiatives such as the National Health Protection Scheme, the emergence of AI and robotics technology in healthcare and poor insurance penetration are some of the growth drivers in the Indian healthcare sector.
Further, governments the world over are looking to reduce healthcare costs. That’s where India is expected to play a key role in terms of fulfilling drug development, production and supply. These factors make healthcare an important segment from an investment point of view, which brings us to the ICICI Prudential Healthcare ETF.
The exchange-traded fund invests in the Nifty Healthcare Index (NHI), and the NFO closes on 14 May 2021. We bring you the highlights of the ETF.
| Good to know Exchange-traded Fund (ETF) Since the composition of an index changes little over time, ETFs require lesser ‘management’ than an active mutual fund that tries to beat market returns. Hence, it’s called a passive investment instrument. That’s also why ETFs are generally less expensive than ordinary active mutual funds. |
Investment objective
The scheme aims to provide returns (before expenses) that closely correspond to the total return of the NHI. The NHI is designed to reflect the behaviour and performance of some of the largest healthcare companies in India. It comprises a maximum of 20 tradable, listed companies.
The ETF’s claimed benefits include
- Exposure to Indian healthcare companies
- Leverage the scaling potential of healthcare facilities in India, creating growth opportunities.
You can check out all the constituents of the index here.
It’s worth noting that the fund does not guarantee that the investment objective of the scheme would be achieved.
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Asset allocation
| Instrument | Allocation (% of total assets) | Risk profile | |
| Minimum | Maximum | ||
| Equity and Equity related securities of companies constituting the underlying index (Nifty Healthcare Index) | 95 | 100 | High |
| Money market instruments including TREPs*, Units of debt schemes# | 0 | 5 | Low to Medium |
| Units of Debt ETFs | 0 | 35 | Low to medium |
*Or similar instruments as may be permitted by SEBI/RBI from time to time, subject to requisite approvals from SEBI/RBI, as applicable.
# Excluding subscription money in transit before deployment/payout
Scheme details
| Name | ICICI Prudential Healthcare ETF |
| Type | An open-ended Index Exchange Traded Fund tracking Nifty Healthcare Index |
| Category | Equity Scheme-Dividend Yield Fund |
| Benchmark | Nifty Healthcare TRI |
| Entry/exit load |
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| Fund Manager |
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| Minimum application amount | ₹1,000 and in multiples of ₹1. |
| Expense ratio | Up to 1% |
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| This product is suitable for investors who are seeking*: | Riskometer |
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**Investors should consult their financial advisors if in doubt about whether the product is suitable for them.
Note: The above information has been sourced from the Scheme Information Document provided by ICICI Prudential Asset Management Company. To read the entire document, click here.
Disclaimer: The above article is purely academic in nature and aims to provide knowledge about basic trading concepts & should not be construed as an opinion or advice to invest or trade. RKSV Securities India Private Limited (brand name Upstox) is the distributor of the mutual fund. Mutual fund investments are subject to market risks; please read all the related documents and/or consult your investment advisor before investing. Past performance of an investment asset does not guarantee future returns.
Mutual fund investments are subject to market risks, read all scheme related documents carefully.