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‘EPFO may invest up to 12% in equity mkts’

Till 30 June, the EPFO invested Rs.7,468 crore in two index-linked exchange traded funds

Policy Pulse
Publish Date: Jul 18 2016 11:07AM | Updated Date: Jul 18 2016 11:07AM

‘EPFO may invest up to 12% in equity mkts’

Sustained by strong stock markets, labour minister Bandaru Dattatreya has said the Employees Provident Fund Organisation may invest 12 percent of its investable amount in equities.

 
As per the minister, till 30 June, the EPFO invested Rs.7,468 crore in two index-linked exchange traded funds—one to Sensex and the other to Nifty—and currently  the market value of the investment stood at Rs.8,024 crore with 7.45 percent yield.
 
"There will be a CBT meeting before July 22. We may take a decision on the quantum of investments to be made in ETF. We are in discussions with Bombay and National Stock Exchanges also. The investment will certainly increase (over last year). "The finance ministry gave us clearance to invest from 5 to 15%. It is a long term investment. It may up to 10 to 12% also depending up on the market conditions. We expect the markets would be stabilised in the long run. Markets also need money," Dattatreya was quoted as saying by PTI.
 
Finance ministry has given its green signal to the EPFO to invest from 5% to 15% of the investable income of the organisation every year.
 
Investable income is the net income of the organisation from the investments it had already made in numerous forms, fresh contributions among others. In 2016, the investable income would be Rs.1.35 trillion, an official said.