Bonus Issue

Never in the history of our capital market was a bonus issue made in an open-ended scheme. This was a win-win deal from the UTI's point of view as the bonus was declared only with the intention of delaying the payouts in the month of July-August itself when a run on the fund due to its dismal performance was expected.

The UTI has succeeded in denying this liquidity for more than 10 weeks. Although this innovation has cost UTI dearly by Rs 3.35 per unit. In real terms, after considering the depreciation in the repurchase price of Rs 2 per unit, it comes to a minuscule less than 8.5 per cent. The worst thing that could happen is the role of regulator - Sebi