UTI turned the tide in the market, that had briefly moved into the positive, by selling in heavyweights like Reliance Industries, SBI and Tisco.

As a result, by 11:15 IST, the BSE Sensex stood at 3,111.39, down 14.49 points. It came off its intra-day high of 3,134.88 by then. But it was well above an earlier low of 3,104.35. In the six sessions between 28 February and 10 March 2003, the BSE Sensex has lost 157.78 points or 4.8% to 3,125.88 from 3,283.66.

Considering the overall negative sentiment in the market, none were expecting indices to hold on to their brief upper levels, in any case. To compound matters, Unit Trust of India moved in to take advantage of the brief recovery and started selling, what with its facing near-term (over the next four months) redemption of at least five schemes. UTI has already proved an aggressive seller over the last couple of sessions.

In the near term, UTI is believed to be facing redemption pressure of Rs 300 crore (Rs 3 billion) as two schemes - the Monthly Income Plan, which has a total corpus of Rs 788 crore (Rs 7.88 billion) and the Master Equity Plan-93, which has a total corpus of Rs 135.56 crore (Rs 1.35 billion), maturing on 31 March 2003 and 1 April 2003, respectively.

Of the three other schemes, IISFUS-98, which has a total corpus of Rs 647.85 crore (Rs 6.47 billion) will mature on 31 May 2003. The MIP-98 (II), which has a total corpus of Rs 513.55 crore (Rs 5.13 billion) and Master Value Fund, which has a total corpus of Rs 125 crore (Rs 1.25 billion) will mature on 30 June 2003. As long as this redemption pressure (from UTI) looms large over the market, not much buying is expected. In fact, the market takes account of the fact that UTI has not yet started selling in a big way as yet. Total corpus of all the five maturing schemes (inclusive of debt and equity investment) in January 2003 was Rs 2,209.96 crore (Rs 22.09 billion) compared to the December 2002 standing at Rs 2,240.15 crore (Rs 22.4 billion). This means only Rs 30.19 crore has been sold since December 2002.

More Hot Pursuits