UTI sees local demand for yield fund

UTI Mutual Fund announced the launch of its new scheme, the UTI Dividend Yield Fund, on Monday.

But officials of UTI MF stated that no collection targets have been set for the scheme, whose initial public offer will be from April 11 to May 3, 2005.

The company officials said UTI Mutual Fund expected a sizable participation from the state, as the UTI Dividend Yield Fund will have retail investors as the focus of the scheme.

"We are not setting any targets for this scheme. However, most equity funds have given good results so far and our own equity funds such as the UTI Mastershare has given excellent returns to investors," said Rajesh Bhojani, president - sales, UTI Asset Management Company Pvt Ltd in Ahmedabad on Monday.

UTI Mutual Fund is the country's largest mutual fund, with assets under management of Rs 20,700 crore. UTI MF has distributed dividend and bonus worth Rs 2,900 crore between February 2003 and March 2005. UTI MF has about 65 per cent of the total mutual funds accounts in the Indian MF industry with over 80 lakh investors.

Ramesh Meena, chief manager UTI AMC PVt Ltd, who is in charge of Gujarat, said that the state has a share of about eight to ten per cent in both, assets under management, as well as bonus or dividend distributed.

"This particular scheme has a focus on retail investors, and we expect the participation from Gujarat to be much higher," said Meena.

Some of the features of the scheme is that the face value of the units is Rs ten and the minimum initial investment will have to be Rs 5000.

The scheme can be availed in two options - growth option and the dividend option, said Sanjay Sinha, fund manager, UTI AMC Pvt Ltd.