What is CPSE ETF – 12 stocks portfolio list – dividend info

CPSE ETF portfolio, company list

Last Updated on 3 weeks ago by Raj Kumar

What is CPSE ETF – stocks portfolio list – dividend info

CPSE ETF stands for Central Public Sector Enterprises ETF. Ministry of finance on behalf of Govt of India launched CPSE ETF on March 18, 2014. The idea behind launching CPSE ETF was to divest the Govt holding in PSU companies in a strategic way.

CPSE ETF is managed by Nippon India AMC on behalf of the govt of India.

CPSE ETF
CPSE ETF

CPSE ETF stocks portfolio composition list

CPSE ETF stocks portfolio composition list is as below:-

Company /stock nameSector% of Total Holdings
 Bharat Electronics Ltd.Industrial electronics8.53%
 Coal India Ltd.Industrial minerals16.92%
 Cochin Shipyard Ltd.Ship building & allied services0.84%
 National Thermal Power Corporation Ltd.Power19.61%
 NBCC (India) Ltd.Construction civil1.14%
 NHPC Ltd.Power3.46%
 NLC India Ltd.Power0.73%
 NMDC LTDIndustrial minerals5.70%
 Oil & Natural Gas Corporation Ltd.Oil exploration18.42%
 Oil India Ltd.Oil exploration2.21%
 Power Grid Corporation of India Ltd.Power- transmission20.99%
 SJVN Ltd.Power0.80%
CPSE ETF stocks portfolio composition list

What is the selection criteria for CPSE ETF stocks?

According to Nippon India AMC ; The selection criteria for CPSE ETF stocks are as below:-

Selection Criteria

The CPSE’s selected meet below mentioned parameters:

• Included in the list of CPSEs published by the Department of Public Enterprise

• Stocks traded (listed & traded and not listed but permitted to trade) at National Stock Exchange of India Ltd. (NSE)

• Having more than 51% government holding (stake via Govt. of India or President of India) under promoter category

• Companies having average free float market capitalisation of more than 1000 Cr. for six month period ending December 2019 are selected

• Companies which are IRDA dividend norms compliant shall be considered eligible to be included in the index

CPSE ETF fund offers till 2021

Government of India (GOI) used innovative route to divest its holding in CPSEs via ETF

CPSE ETF TrancheLaunchSubscriptions 
(Rs. Crs.)
Allotment (Rs. Crs.)Listing Date
New Fund Offer (NFO)Mar-144,3633,00004-Apr-14
Further Fund Offer (FFO)Jan-1713,7056,00031-Jan-17
Further Fund Offer 2 (FFO 2)Mar-1710,0832,50028-Mar-17
Further Fund Offer 3 (FFO 3)Nov-1831,20317,00010-Dec-18
Further Fund Offer 4 (FFO 4)Mar-1930,46410,00001-Apr-19
Further Fund Offer 5 (FFO 5)Jul-1948,48511,50029-Jul-19
Further Fund Offer 6 (FFO 6)Jan-2021,70716,50010-Feb-20
CPSE ETF fund offers

CPSE ETF Share price history

Below chart shows CPSE ETF Share price history over the years. The ETF hasn’t given any meaningful returns over the last 6 years!

CPSE ETF Share price history
CPSE ETF Share price history

CPSE ETF fund performance

Its quite disappointing to see the kind of performance the CPSE ETF has shown since its launch. Below image shows CPSE ETF’s performance as of June 30th 2021

CPSE ETF fund performance
CPSE ETF fund performance

CPSE ETF has clearly underperformed compared to all of the major indices. Its really sad to see the CPSE ETF gave negligible returns to the investors since its launch in March 2014!

CPSE ETF Dividend details

There is a lot of confusion in investors mind about whether the CPSE ETF gives any dividend to its investors when a company which is part of CPSE ETF gives dividend. The short answer to this is – NO. The CPSE ETF doesn’t give any dividend to its investor when the company which is part of CPSE ETF gives dividend.

The dividend amount is reflected as part of the ETF NAV when dividend amount is received.

Benefits of CPSE ETF

According to Nippon India AMC here the benefits of CPSE ETF

Well Defined Portfolio: CPSE ETF investment strategy & stock selection is clearly defined; it would replicate the Nifty CPSE Index & invest only in  companies forming the index in the same proportion as the underlying index 

Diversification: Buying a single unit currently offers diversification of 12 stocks in the large CPSE companies 

Transparency: Nifty CPSE Index constituents are made available in public domain on a daily basis by NSE 

Liquidity: ETF units are traded on exchanges & can be easily liquidated during trading hours (subject to availability of buyer/Seller). Authorised  Participants / Large Investors also have the option of coming to the AMC for procurement/sale of units in creation unit sizes (100,000 units with 1  unit equivalent to 1/100th of Nifty CPSE Index) 

Margin for trading: CPSE ETF is accepted as margin for trading on NSE & BSE with applicable haircut 

Sector Exposure with less Idiosyncratic risk: CPSE ETF allows one to take exposure to the large Central Public Sector Enterprise (CPSE) companies across different sectors with relatively less stock specific risk, as risk gets diversified among basket of stocks 

Index track Record: Launched in Mar-2014, base date 1-Jan-2009 the index has a track record of 11 years

What is the expense ratio for CPSE ETF?

The current expense ratio for CPSE ETF is 0.01% which is extremely less compared to actively managed mutual funds.

Where can I purchase CPSE ETF?

CPSE ETF can be purchased in NSE or BSE. You need to have a demat and trading account to purchase CPSE ETF.

What is the difference between NIFTY 50 ETF and CPSE ETF?

NIFTY 50 ETFs are based on the stocks which are part of NIFTY 50 index where as CPSE ETF is an ETF which consists of 12 CPSE companies.

Is it good to invest in CPSE ETF?

Going by the performance of CPSE ETF in last 7 years; it’s quite disappointing to see that the CPSE ETF hasn’t even given any returns to its investors since 7 years. Most of the companies which are part of CPSE ETF are cyclical companies. They perform really well in cycles. If you are retail investor then there are better opportunities in NIFTY 50 ETF than CPSE ETF.

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