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UTI to unveil 6 plans after 2-yr hiatus

Rakesh P Sharma & Janaki Krishnan in Mumbai

After a gap of over two years, the Unit Trust of India is set to launch at least six schemes in the next few months. The list includes a regular income plan, a variable income plan, a liquid plan and a fixed income plan.

R Rangarajan, the newly designated vice-president of UTI, said: "At least half-a-dozen new schemes are currently being drawn up and they are at various stages. We expect to launch them in the next few months."

According to Rangarajan, the new schemes are necessary for the trust to mop up funds and to sustain fund inflows.

UTI had filed offer documents with the Securities and Exchange Board of India to launch two funds -- UTI variable investment scheme (UTI-VIS) and UTI regular income scheme (UTI-RIS). Sebi is yet to approve the schemes.

Recently Sebi chairman G N Bajpai had said that it would permit UTI to launch new schemes.

It may be recalled that Sebi had spiked the trust's plans to launch new schemes on account of clarifications on the plans along with issues pertaining to the trust's sponsorship.

Meanwhile, the government is learnt to be close to sorting out the sponsorship issue and is in an advanced stage of talks with some of the existing sponsor shareholders in the trust.

The government plans to bring new sponsors to the trust at a later date. Officials said that the government wanted to opt out of responsibilities over UTI and make it totally answerable to Sebi.

UTI has also started talks with some of the companies it has promoted or co-promoted in order to generate more liquidity in its Development Reserve Fund.

Currently, more than half of the DRF comprises such holdings and UTI is planning to liquidate the assets under the fund in order to meet shortfalls.

A sizable portion of its DRF -- to the tune of Rs 6 billion -- is in the form of holdings in companies promoted by it.

Rangarajan said while none of the organisations had turned down the proposal of UTI exiting the present set-up, there were no positive suggestions from their side as well.

"The modalities have to be worked out," said Rangarajan, adding that these companies would have to find new promoters or new investors.

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