According to the press release, the index will include top 30 non-banking financial stocks from S&P BSE 250 large, midcap Total Return Index with a maximum stock weight capped at 15%. The index will be rebalanced semi-annually in June and December. Currently, the index includes stocks of Housing finance companies, NBFCs, Exchanges, Asset Management Companies, Insurance, Card Payment & Fintech etc.
As of June 2022, the index constituents feature renowned names such as Housing Development Finance Corp,
, , , ., Etc. The top 10 stocks constitute nearly 72% weight in the index. In terms of industry breakup NBFCs account for the majority with weight close to 28%, followed by Life Insurance at 21% and Housing Finance companies accounting for 18%. The index is largely skewed towards large cap companies accounting for 75% of the weight, while mid cap companies account for the rest.
“Motilal Oswal S&P BSE Financial Services ex Bank 30 Index Fund offers investor first of its kind opportunity to invest in the non-banking financial sector. The fund will invest in new age financials companies from Housing finance companies, NBFCs, Exchanges, Asset Management Companies, Insurance, Card Payment & Fintech etc. The Fund will enable Indian investors to capitalize on the growth of financialization of assets, shifting consumer mindset from saving to investing and benefit from the companies that will gain from the consumption theme,” said Pratik Oswal, Head of Passive Funds, Motilal Oswal .
Navin Agarwal, MD & CEO, Motilal Oswal Asset Management Company Ltd said, “With an objective to bring new investment opportunities through innovative products, we built a new concept to leverage wealth creation opportunities beyond just banks within the financial services sector. With India’s urban population set to grow to 50% from the current 35%, the migration will trigger transfer of money from S&P BSE Financials Ex-Bank 30 Index has outperformed the S&P BSE 250 Large MidCap index over the last 15 years, on a total returns basis. The index has noted a CAGR of 15.3% vs S&P BSE 250 Large MidCap Index 14%, outperforming the broad market by more than 1%. It has also been observed that the index tends to do well during a bull & recovery cycle.