Mumbai, May 29: The Unit Trust of India has decided to dematerialise 50 per cent of its holdings in every scrip that is currently admitted for dematerialisation at the National Securities Depository Ltd.

The country's leading mutual fund which has a corpus in excess of Rs 50,000 crore has also initiated talks with NSDL to admit its four top schemes, US-64, Mastershare, Mastergain and Masterplus to the depository to enable investors to trade their units in the dematerialised segment.

The twin move is expected to provide a major boost to the depository as UTI is a financial powerhouse and the measures taken by it are expected to trigger off similar such efforts from other FIs and FIIs.

UTI had earlier decided to dematerialise 25 per cent of its holdings and in fact has already placed dematerialisation requests in the case of 33 scrips which are admitted to the depository.

The process commenced three weeks back and given the huge corpus that UTI manages there might well be a sudden surge in the total value of shares that are currently dematerialised.

In fact the first signs are already evident as last week alone Rs 900 crore worth of shares were dematerialised and according to NSDL sources a bulk of this was done by domestic institutions.

"We have now decided to dematerialise 50 per cent of our holdings in every scrip that is admitted with the depository. The decision has been taken recently and has been conveyed to our custodian", said PJ Nayak, executive trustee of UTI, while speaking to The Financial Express.

"Over the past three weeks a large number of dematerialisation requests have gone out from us and the process is on. We are very keen to avail of the benefits of risk free settlement process offered by the depository", said Nayak.

Significantly, a large number of FIIs have been waiting for the Indian institutions to take the plunge for dematerialising their holdings. According to NSDL, executive director, Gagan Rai, the move by UTI will trigger off a similar move by FIIs.

In another development, UTI has initiated talks with NSDL to admit four of its top schemes for dematerialisation at the depository. "Once we have worked out the modalities we will take the consent of unit holders to offer them the option of trading their units in the dematerialised segment", said a UTI source.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.