The UTI BSE Sensex ETF is an open-ended scheme that aims to replicate the performance of the S&P BSE Sensex index. This ETF provides investors with exposure to 30 of the largest and most actively traded companies on the Bombay Stock Exchange (BSE), offering a diversified investment aligned with the Indian equity market.
Key Details:
- Fund House: UTI Mutual Fund
- Launch Date: August 26, 2015
- Assets Under Management (AUM): ₹43,451 crore (as of January 31, 2025)
- Expense Ratio: 0.05% (as of January 31, 2025)
- Net Asset Value (NAV): ₹810.4514 (as of February 24, 2025)
- Benchmark: S&P BSE Sensex Total Return Index (TRI)
- Riskometer: Very High
Who is theFund Manager of UTI BSE Sensex ETF?
As of February 27, 2025, the UTI BSE Sensex ETF is managed by Mr. Sharwan Kumar Goyal. Mr. Goyal holds a Bachelor of Commerce (B.Com) degree, is a Chartered Financial Analyst (CFA), and has a Master of Management Studies (MMS). He began his career with UTI in June 2006 and has accumulated 15 years of experience in risk and fund management.
Performance:
Since its inception, the UTI BSE Sensex ETF has delivered an annualized return of 13.28%. Over the past three years, it has achieved a return of 12.26%. These figures indicate the fund’s capability to closely track its benchmark index, providing returns in line with the overall market performance.
Portfolio Composition:
The ETF’s portfolio mirrors the S&P BSE Sensex, with significant allocations in large-cap companies across various sectors. As of January 31, 2025, the top holdings include:
Top Holdings
- HDFC Bank: 14.26%
- ICICI Bank: 9.80%
- Reliance Industries: 9.49%
- Infosys: 7.53%
- Bharti Airtel: 4.83%
The fund maintains a 99.9% allocation in equities, with the remaining 0.1% in cash and cash equivalents.
Investment Details:
- Minimum Investment: ₹5,000
- Minimum Additional Investment: ₹1
- Exit Load: Nil
- Lock-in Period: None
Investors can purchase units of the UTI BSE Sensex ETF through the UTI Mutual Fund website or via stock exchanges where the ETF is listed. This fund is suitable for investors seeking long-term capital appreciation by investing in a diversified portfolio of blue-chip companies representing the Indian economy.
UTI BSE Sensex ETF Returns
As of February 27, 2025, the UTI BSE Sensex ETF has demonstrated consistent performance since its inception. Below is a summary of its annualized returns over various periods:
| Period | Annualized Return |
| 1 Year | 8.50% |
| 3 Years | 11.75% |
| 5 Years | 14.27% |
| Since Inception | 13.56% |
These figures indicate the fund’s capability to closely track its benchmark index, the S&P BSE Sensex Total Return Index (TRI), providing returns in line with the overall market performance.
UTI BSE Sensex ETF Price Prediction
As of February 27, 2025, the UTI BSE Sensex ETF is trading at ₹848.35 per unit.
This ETF aims to replicate the performance of the S&P BSE Sensex index, which comprises 30 of the largest and most actively traded companies on the Bombay Stock Exchange (BSE).
Market Outlook:
Recent analyses suggest a cautious yet optimistic outlook for the Indian stock market:
- Reuters Poll (February 27, 2025): Indian benchmark indices are anticipated to experience a gradual recovery after significant declines. The BSE Sensex is projected to reach approximately 80,850 by the end of 2025.
- HSBC Report (January 9, 2025): HSBC downgraded Indian equities to a “neutral” rating, adjusting its end-2025 target for the BSE Sensex to 85,990, citing concerns over slower economic growth and high valuations.
Considerations for Investors:
- Market Volatility: The Indian stock market has faced challenges, including high inflation, stagnant incomes, and significant foreign investor sell-offs, leading to recent downturns.
- Economic Indicators: Factors such as potential interest rate cuts and tax exemptions may influence market performance, but their immediate impact on corporate earnings and consumer spending remains uncertain.
While these projections provide insights into potential market trends, it’s essential to recognize that actual performance can be influenced by various economic and geopolitical factors. Investors are encouraged to conduct thorough research and consult with financial advisors to ensure that their investment choices align with their financial goals and risk tolerance.
Strengths of UTI BSE Sensex ETF:
1) Market Benchmark Tracking:
- The ETF replicates the S&P BSE Sensex, which represents 30 of India’s largest and most actively traded companies.
- Provides investors with broad market exposure and blue-chip stock holdings.
2) Low Expense Ratio:
- With an expense ratio of 0.05%, it is one of the cheapest ways to invest in large-cap Indian equities.
3) Diversification & Stability:
- The ETF holds a diversified portfolio across sectors like banking, IT, oil & gas, telecom, and FMCG, reducing company-specific risk.
- Includes companies with strong fundamentals and market leadership.
4) Liquidity & Ease of Trading:
- Listed on stock exchanges (BSE & NSE), allowing investors to buy/sell in real time like regular stocks.
- Higher liquidity compared to actively managed funds, reducing bid-ask spreads.
5) Transparent Structure:
- Holdings and performance closely mirror the BSE Sensex, ensuring clarity for investors.
6) No Fund Manager Bias:
- As a passive fund, it avoids fund manager biases and aims to deliver returns aligned with the index.
Risks of UTI BSE Sensex ETF:
1) Market Volatility Risk:
- The ETF directly depends on the performance of the Sensex, meaning any decline in the index will reduce the ETF’s value.
- Geopolitical risks, inflation, or global economic downturns can impact performance.
2) No Active Management:
- Unlike actively managed funds, this ETF does not adjust holdings based on market conditions.
- It may underperform in bear markets when active funds can rebalance their portfolio.
3) Sector Concentration Risk:
- The financial sector dominates (~40%) of the Sensex; hence, a banking crisis could significantly affect the ETF.
4) Foreign Investor Dependence:
- FIIs (Foreign Institutional Investors) have a large influence on Indian stock markets.
- If foreign investors pull out capital, the ETF may face volatility.
5) Tracking Error:
- Although minimal, there may be small deviations between the ETF’s returns and the actual BSE Sensex due to fund expenses and cash holdings.
6) Dividends Not Automatically Reinvested:
- Unlike mutual funds, investors need to manually reinvest any received dividends for compounding benefits.
Final Verdict:
- Best For: Long-term investors seeking market-linked growth with low-cost passive investing.
- Not Ideal For: Those looking for active risk management or protection against short-term downturns.
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