The Hindu Business Line : Current market valuation is not expensive: UTI

UTI Mutual Fund sees the stock market exhibiting "volatility" in the near term even while being hopeful that corporate India would return "fairly decent numbers" in the earnings season beginning from Monday.

"We expect corporate earnings to grow by 15 to 18 per cent. The market valuation is not expensive. It is fairly priced. I am not saying its cheap," Mr A.K. Sridhar, Chief Investment Officer, UTI MF, said here today at a press conference to announce the launch of "UTI-Dividend Yield Fund" scheme.

The initial offer period for the open-ended equity oriented scheme is from April 11 to May 3. The UTI Mutual Fund CIO said that the UTI Dividend Yield fund was suitable for investors with at least a 1-year time horizon for their investments.

Responding to queries, he said that no target has been fixed for mop up from the scheme. "We would prefer to have a wider reach with larger number of applications," he said.

Mr Sridhar also said that he doesn't see any hardening of interest rates in the near term in the economy. He had a similar viewpoint on deposit rates. At the same time, he held that the proposed changes in income tax provisions augur well for mutual funds.

"The changes proposed include removal of Section 80L. The proposed taxation changes would dramatically change the saving habits of Indians, especially those in the middle income group," he said.

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