MARKET EXIT ROUTE FOR US-64 MAY BE WIDENED
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- Published 11.07.01
Calcutta, July 11 : Calcutta, July 11: Investors of US-64, Unit Trust of India's (UTI) flagship scheme, may soon be able to sell units in the stock markets without having them dematerialised. At present, up to 500 units can be traded through the odd-lot window in the physical mode, but the facility is limited to original purchasers. In view of the ban on sale and repurchase on the scheme, the Securities and Exchange Board of India (Sebi) may take US-64 off the compulsory dematerialised trading list so that it can be traded in the physical mode without curbs. A formal request has been sent to the market regulator on the issue. UTI executive director BG Daga said the application was made at the end of last month, but there has been no word from Sebi so far. "We have not had the time to look into the issue since we are busy preparing our presentation to the Joint Parliamentary Committee (JPC). We will look into UTI's proposal after that. Any proposal which benefits small investors will be considered favourably," Sebi chairman DR Mehta told The Telegraph. US-64 is listed on the National Stock Exchange, Delhi Stock Exchange, Ahmedabad Stock Exchange, Bangalore Stock Exchange and the OTCEI. Though the secondary market for the scheme appears to be reviving, retail investors have not gained since most of them hold units in the physical form. The Delhi Stock Exchange has opened an odd-lot window to enable investors to trade in US-64 in the physical mode. Other exchanges are expected to follow suit. However, transactions at the odd-lot windows of bourses have been poor. Withdrawing the scheme from compulsory dematerialised trading will give it greater liquidity, but there is also a fear that this could lead to a glut of units in the stock market. If that happens, analysts say its market price could plunge.