Hanhwa Investment & Securities Launches 2 ACE India ETFs... "Focused Investment on Sectors and Leading Groups"

Korea Investment Trust Management announced on the 4th that it will launch two exchange-traded funds (ETFs) investing in the Indian market on the 10th of this month.

The two new ACE ETFs are the ACE India Consumer Power Active ETF and the ACE India Market Representative BIG5 Group Active ETF. They are characterized by focused investment in growth sectors within the Indian market. Korea Investment Trust Management is the first in Asia to launch active-type ETFs investing in India.

Hyun Dong-sik, Head of Overseas Business Division at Korea Investment Trust Management, is the portfolio manager of the ACE India Consumer Power Active ETF. The benchmark index for this ETF is the Indxx India Super Consumption Index, calculated and published by Indxx, LLC. The ETF plans to concentrate investments in 15 companies within the consumer discretionary sector (home appliances, automobiles, healthcare) that have high long-term growth potential among India's consumption-related industries.

The reason for selecting consumer discretionary as the growth sector reflects the case of China. India is considered the "Next China" and is likely to follow a similar growth trajectory as China, which emerged as a global supply chain hub in the 2000s, leading to economic growth and increased income and consumption. Accordingly, Korea Investment Trust Management analyzed that a selective investment strategy focusing on consumer discretionary sectors such as home appliances, automobiles, and healthcare, where demand increases with GDP growth, is effective.

The ACE India Market Representative BIG5 Group Active ETF will be managed by Oh Hye-yoon, Deputy Head of Overseas Investment Management at Korea Investment Trust Management. Its benchmark index is the Indxx India Big 5 Conglomerates Index, calculated and published by Indxx, LLC. The ETF will select the top five leading groups in India and concentrate investments in 15 to 20 stocks of each group and their core affiliates.

The top five groups are △TATA △Reliance △Adani △L&T △BAJAJ, primarily composed of infrastructure and renewable energy sectors. Based on performance over the past five years, these sectors have all recorded returns exceeding the market index.

Korea Investment Trust Management plans to publish an emerging market investment guidebook later this month to commemorate the listing of the two India investment ETFs. The guidebook, created in collaboration with Professor Lee Won-bok, author of "Faraway Neighbors," will include stories related to investments in four Next China countries: India, Vietnam, Indonesia, and Mexico. In connection with this, since the 31st of last month, an event has been underway offering physical copies of the guidebook and prizes to those who certify ownership of 10 or more ACE ETF shares.

Head Hyun Dong-sik explained, "The Nifty 50, India's representative index, has a large proportion of financial stocks that have recently underperformed, making it difficult to fully benefit from economic growth," adding, "By analyzing China's experience during its economic growth, we introduced products that focus on growth sectors rather than the representative index."

He continued, "Since the ETFs are listed separately as the consumer discretionary sector-focused 'ACE India Consumer Power Active ETF' and the infrastructure-focused 'ACE India Market Representative BIG5 Group Active ETF,' investors can concentrate on their preferred sectors," and added, "Both products are available for investment through defined contribution (DC) pension plans and individual retirement pensions (IRP), so we recommend long-term installment investments."