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UTI bought Rs 120 mn US-64 units on January 1

The Unit Trust of India, the country's biggest fund manager, said on Wednesday its flagship US-64 scheme repurchased units for Rs 120.2 million at a fixed price of Rs 10.50 on January 1.

In addition, it also repurchased units worth Rs 540,000 at net asset value on Tuesday, the first day of its shift to trading at market-linked prices, an official at UTI told Reuters.

US-64, which holds a quarter of all assets under UTI's management, also made sales of Rs 24.8 million at net asset value on January 1, he said.

UTI manages about Rs 516.7 billion, representing about 52 per cent of the total assets of India's mutual fund industry.

Till July 2001, UTI had sold and repurchased US-64 units at fixed prices. It has not revealed how these prices were set.

Following a huge redemptions surge triggered by a stock market slide, UTI first completely suspended US-64 unit repurchases before allowing limited redemptions.

At that time, UTI also said it will shift trading in US-64 units to market-linked prices from January 2002 while offering a guaranteed sale and repurchase price up to 5,000 units per investor.

Last week, UTI declared US-64's NAV for the first time in its 37-year history. It stunned analysts by disclosing a market value of Rs 5.81, against expectations of Rs 7-8.

This had led to fears there will be a huge upsurge in redemptions when the NAV-linked redemptions began on Tuesday.

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