Motilal Oswal Launches India's First Index Fund Tracking BSE 1000 TRI

Key Highlights

• Motilal Oswal Mutual Fund introduces India's first index fund tracking BSE 1000 Total Return Index.
• The fund offers diversified exposure to 1,000 companies across 22 sectors, reducing concentration risk.

Motilal Oswal Mutual Fund (MOMF) on Thursday launched India's first index fund tracking the BSE 1000 Total Return Index, giving investors access to a diverse portfolio of the top 1,000 listed companies across large, mid, small, and micro-cap segments. The fund opened for subscriptions on June 5 under a New Fund Offer (NFO) that will last until June 19, 2025.

What is the Motilal Oswal BSE 1000 Index Fund?

This new fund passively replicates the BSE 1000 Total Return Index, which represents approximately 94% of India's listed market capitalization, making it one of the most inclusive equity benchmarks in the country. It covers 22 sectors, giving investors access to both industry leaders and high-growth emerging businesses.

It provides exposure to a mix of established market leaders and emerging companies across 22 sectors, with the top-10 stock weight limited to 33%, thereby reducing concentration risk. The index includes micro-cap companies, whose market capitalization and liquidity have increased by 5x and 14x, respectively, over the last five years. All within a passive, free-float weighted structure that rebalances semi-annually.

NFO Period: June 5, 2025 - June 19, 2025.

Investment Objective: The scheme's investment objective is to provide returns that, before expenses, correspond to the total returns of securities represented by the BSE 1000, subject to tracking error. However, there is no assurance or guarantee that the scheme's investment objectives will be met.

Benchmark: The BSE 1000 Total Return Index.

Investor Profile: This product is appropriate for investors seeking long-term capital growth and a return comparable to the BSE 1000 Total Return Index, subject to tracking errors.

Minimum application: During NFO and ongoing bases; The lump sum is ₹ 500, with subsequent multiples of ₹ 1. The minimum instalment amount, frequency, number of instalments, and SIP date/day options are all different and specified in the Scheme Information Document.

Exit Load: 1% - If redeemed within 15 days of the allotted date. Nil - after that.

Also Read: Motilal Oswal Founders Inject USD 100 Million into Zepto

Why does this fund matter?

• Broad Diversification: Includes companies from all market caps and sectors.
• Reduced concentration risk by capping the top 10 stocks at approximately 33%.
• Passive and Cost-effective: Semi-annual rebalancing; no active stock picking.
• Aligned with India's growth: Represents economic trends in infrastructure, manufacturing, technology, and more.

According to MOAMC's internal research, India is expected to maintain its strong growth trajectory, bolstered by strong fundamentals, supportive policies, and robust domestic demand. The International Monetary Fund (IMF) forecasts that India's GDP will grow by 6.2% in 2025 and 6.3% in 2026. 

"This growth is consistent with India's "Viksit Bharat 2047" vision, which seeks to transform the country into a fully developed, high-income nation by 2047, with a target GDP of $23-$35 trillion and per capita income of $15,000-$20,000. As India advances in technology, manufacturing, energy, and infrastructure, opportunities in a variety of industries are likely to emerge. Motilal Oswal stated that a diversified portfolio, such as the BSE 1000, which includes a diverse range of listed companies, provides investors with a structured way to participate in this evolving growth landscape.