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S. Vaidya Nathan

THE Unit Trust of India (UTI) has launched an Index Linked Plan under its Variable Investment Scheme. The scheme will invest in debt and equity. The equity part of the portfolio will track the 30 stocks in the BSE Sensitive Index. The fund will invest in the stocks in the same proportion of weight they have in the Sensex's market capitalisation.

This part of the scheme will be passively managed and be like an index fund. The features of the scheme provide for built-in-triggers using which the fund managers will book profits (say, when the Sensex crosses prescribed thresholds). At lower levels of the index, they will increase the equity exposures.

The plan is somewhat similar to the PE Ratio and Asset Allocation Plan launched by Pioneer ITI and now part of the Franklin Templeton schemes following the merger of the two. The new scheme will be open for subscription in the initial offering period between November 7 and 22.

The minimum investment amount is Rs 5,000 and subsequent investment can be made in multiples of Rs 1,000. The fund will re-open for sale and repurchase on an ongoing basis within 30 days of the closure of the initial offer. Repurchase will be at NAV while there will be a sales load of 2 per cent. This is the second new scheme of UTI in quick succession following the UTI Regular Income Scheme.

Alliance'95 dividend: Alliance Capital Mutual Fund has announced a dividend of Rs 1 per unit or 10 per cent for its open-end balanced Alliance'95 Fund. This is applicable for the Dividend Plan and is for the period ended October 30 2002. Investors as on October 30 are eligible to receive this dividend.

Primary Equity dividend: The UTI has announced a dividend of 10 per cent or Rs 1 per unit for its Primary Equity Fund scheme. The dividend will be paid to all unit holders whose names appear in the register of investors as of November 14 2002, the record date. The fund has turned in a compounded annual return of 5 per cent since its launch during which period the BSE Sensitive Index has lost 0.35 per cent. The earlier dividend in the scheme was a 15 per cent payout in December 2001.

US-64 record date: The books of US-64 will remain closed from November 2 to 14 (both days inclusive). During the period, no sales, repurchase, change of address or transfers will be permitted. For investors after January 1, 2002, dividend re-investment units allotted after July 1 and units acquired in the secondary market will be transferred to US 2002.

US-64 NAV: The unit-holdings of US-64 Old and US-64 New (US 2002) will have the same net asset values as of November 14. Unit-holders of US 2002 will have an option to repurchase their units at NAV without any exit load till January 15, 2003. Units of US 2002 purchased from November 15, 2002 will be repurchased with the applicable exit load and not at NAV. Units held under the Children's Gift Plan 1970 will be held under US-64.

US 2002 statements: The UTI has announced that the Statement of Account under US 2002 after split of US 64 will be dispatched by the second week of December 2002. Investors will be informed of units held under US-64 as well as US 2002.

UTI Act goes: The Government of India has promulgated the ordinance to repeal the UTI Act of 1963. This will be followed by a split of UTI into UTI I and UTI II. After recommendations to this effect by a number of committees in the last six years, the Government has at last moved to remove the statutory backing for UTI.

UTI RIS re-opens: The UTI's income scheme, the UTI Regular Income Scheme, has re-opened for subscription and repurchase on an ongoing basis from October 28 2002. This is an open end debt scheme without any assured returns. The scheme had raised Rs 200 crore in the initial offering period.

HDFC load changes: HDFC Mutual Fund has announced that there will be not entry load for HDFC Income Fund for investments of up to Rs 10 lakh. There will be an exit load of 0.5 per cent if redeemed within six months of investment. Fir investments in excess of Rs 10 lakh, there will be an exit load of 0.25 per cent if funds are redeemed with three months of investment. There will be no loads for switching to other schemes.

LIC MF Index Fund: The SEBI has approved the proposed index fund of LIC Mutual Fund. The LIC MF Index Fund will track the Nifty and Sensex under separate options.

: The price for November 2002 under the Special Liquidity Package for US-64 is Rs 11.40 per unit for holdings of less than 5,000 units. The package will end on May 31, 2003, when the units will be bought back at Rs 12 per unit. Holdings of over 5,000 units will be repurchased at NAV now and at Rs 10 per unit if held till May 2003.<137>

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