Uti No Longer A Net Seller On The Markets: Daga

have caused its secondary market sales to slow down.

Brij Gopal Daga, chief general manager, UTI, yesterday said that redemptions, particularly in US-64, UTIs flagship scheme, were lower this year, with fresh inflows greater than outflows. That is why UTI, as of date, is not as aggressive a seller as it was this time last year, Daga added.

According to UTI officials, the total inflows so far in US-64 have been to the tune of Rs 800 crore, with outflows lower than that.

The secondary market sales therefore have been lower, sources said. However, the stockmarket has been complaining that UTI has been selling of late, even while the indices are headed south.

 

UTI officials, on the other hand, say that the institution has never sold aggressively to bring the prices down as a deliberate strategy.

However, they also sound a note of caution saying the trend may change

as and when the redemptions pressure becomes different.

If redemptions mount, we have very little option, a UTI official said.

UTI sources said the meeting of its top brass with finance ministry officials on Thursday did not explicitly discuss the point of UTI

supporting the markets.

There was no directive from the ministry asking UTI to support the market, officials said, contradicting speculation that the ministry had stepped in to stem the downslide in the markets.

UTI sources say that certain policies like scrapping of the 80M benefits and the Department of Public Enterprises (DPE) circular asking PSUs not to invest in units had also taken a heavy toll on the UTI liquidity position. Had that not happened, the situation would have been much better, add UTI sources.

The other problem facing institutions is the price aspect. If FIs purchase shares at slightly higher prices in bulk deals, then the fear of questions being raised these days would inhibit aggressive market purchases.

The raids at present being conducted by agencies is also playing a part in cramping the FIs style, sources add.