13 schemes already delisted from SEs by mutual funds major

UTI on delisting mode, Mastershare next in line

Sudhir Shetty & Yagnesh Kansara

Mumbai, Dec 2: The Unit Trust of India (UTI) is contemplating delisting one of its most popular schemes, Mastershare, from the bourses some time in the beginning of next year and open a repurchase window itself, in line with the move on other schemes, which were delisted earlier.

These schemes include UTI Masterplus 91, Mastergain 92 and 11 other schemes where repurchase windows had been opened for their prevailing Net Asset Values (NAVs) following their delisting from the bourses last year.

A senior UTI official told The Financial Express, “There is a huge demand from unitholders that UTI should open the repurchase window for Mastershare to enable investors to fetch a better price for the units as this scheme generally trades at a huge discount to its NAV on the exchanges. We may look into the demand of the investors, and go for delisting.”

The schemes, which were delisted by UTI from April 26, 2000 include Master Plus 91, UGS 2000, UGS 5000, Mastergain 92 and Grand Master, and Mastergrowth from May 22, 2000. Monthly Equity Plan (MEP) 1993, MEP 1995, MEP 1996, US 92, EOF were delisted from June 26, 2000 while listing for ISEF was not renewed from November 20, 2000 and US-95 from August 1, 2000.

The official also said, “Not only do investors benefit by a better price through the repurchase window, but they are likely to get faster payment, within three days time, while from bourses the time taken is a minimum of one week.”

While UTI will benefit by not paying listing fees, by delisting the existing schemes from the exchanges, the individual schemes will benefit as each scheme has to pay a separate listing fee to the exchange and this fee is made good from its corpus. The fees are hefty as these schemes are listed on more than one stock exchange including the regional stock exchanges.

Explaining the rationale behind such a move further, the official said, “When there is no repurchase facility available to the investors, these schemes were listed on the exchanges to provide an exit option to them. But with UTI opening the repurchase window at NAV, investors get the benefit of moving out of the scheme at a better rate, as these schemes are normally quoted at a discount to the NAV on the bourses. The discount in some cases may be as high as 40 per cent.”

UTI’s Mastershare on Thursday closed 5 paise down at Rs 9.20 on The Stock Exchange, Mumbai (BSE) with a volume of 1.11 lakh units and on the National Stock Exchange (NSE) it closed at Rs 9.20 on Thursday, but with a higher turnover compared to BSE at 4.85 lakh units. Mastershare rallied steadily on the bourses in November. It closed at Rs 8.55 on NSE on November 1.

The last NAV for Mastershare was Rs 10.16 as on November 7, the books of accounts of Mastershare are currently closed for distribution of income warrant at 10 per cent per annum.

The UTI official also said despite the US-64 crisis, there was no panic amongst unitholders to surrender their shares in schemes like Mastergain ’92 and Masterplus ’91 where the repurchase window is open and as investors know that they can avail this facility anytime as per their needs.