UTI to face shortfall in two schemes

the Rs 400-crore Development Reserve Fund to bridge the gap. “The schemes in trouble are now beginning to appear as UTI has started drawing accounts from income funds separately after the Sebi diktat.

Earlier, the fund followed a method of drawing accounts of all the income schemes in one pool and hence, it was difficult to know the gaps in individual schemes due to a combined surplus,” says a fund analyst.MISB ’93 had offered cumulative and monthlyincome options to investors. Under the monthly income plan, investors were assured of a 14 per cent per annum return with a 2 per cent (20 paise) capital appreciation on redemption. For the cumulative plan, redemption will be at Rs 20.375. While the current repurchase price (at a 5 per cent discount to the NAV) in MIP is Rs 10, it is Rs 16.36 paise for the cumulative plan. After adjusting the discount, the current NAV in the two options should be Rs 10.20 and Rs 17.17, respectively. Based on the current NAV, the gap for the cumulative option works out to Rs 3.20 while there is no shortfall in MIP. The scheme has a combined unit capital of Rs 430 crore. If 50 per cent of the unit capital is assumed to be in the cumulative option, the shortfall works out to Rs 69 crore.

In the case of DIUP ’93, the shortfall is likely to be higher, based on the current NAV. The scheme has a combined unit capital of Rs 350 crore.