CIL sells Rs 550-cr shares towards CPSE's exchange traded fund

Coal India has sold 2.2 crore shares

Coal India has sold shares worth over Rs 550 crore towards the CPSE's exchange traded fund as part of government's disinvestment programme.

The PSU has sold 2.2 crore shares amounting to Rs 550.6 crore, Coal India (CIL) said in a filing to BSE.

The ETF gives investors an opportunity to diversify their portfolio through cost-effective investment in blue-chip public sector companies across sectors at a 5% discount.

The CPSE ETF basket comprises shares of 10 companies - Oil & Natural Gas, GAIL, Coal India, Rural Electrification, Oil India, Indian Oil, Power Finance, Container Corporation of India, Bharat Electronics and Engineers India.

An ETF basically tracks a particular index and its returns are based on the performance of that index.

ETFs have grown significantly in the past few years in India and their assets under management have gone up from Rs 1,396 crore in March 2009 to Rs 11,807 crore in September 2013. ICICI Securities advised the government on the ETF.

Coal India had in January declared an interim dividend of Rs 29 per share, amounting to Rs 18,317 crore, for 2013-14.