The Hindu Business Line : UTI AMC awaits SEBI nod to launch gold exchange fund

THE UTI Asset Management Company (UTI AMC) is eyeing the launch of Gold Exchange Fund, once the SEBI guidelines are announced. The total assets under the management of UTI MF have crossed Rs 25,000-crore on August 31.

Speaking to newspersons here on Friday, after the launch of two UTI MF centres in the twin cities, the Executive Director of UTI AMC, Mr D.S.R. Murthy, said crossing the Rs 25,000-crore-mark is a milestone and reflects the investor confidence in UTI funds.

This year, UTI MF expects to handle Rs 6,000 crore more and thus far have mopped up Rs 4,700 crore.

Mr Murthy said: "We are ready to launch the Gold Exchange Fund and this is one area we expect to see rapid growth. There are certain general misconceptions about the fund, wherein people feel that they can deposit their ornaments and collect them later. In fact, they need to understand that it does not work that way. The gold ornaments thus deposited would be converted into gold and they can only encash or collect gold."

During this year, UTI AMC has planned to locate 18 new centres. Of these, nine have been opened, with two of them in the twin cities of Hyderabad and Secunderabad. Later this month, one more centre would be opened in Bangalore, followed by Kolkata.

The Government is keen to exit from the UTI AMC, as per the agreement signed in 2003 when UTI AMC was formed with PNB, LIC, SBI and Bank of Baroda. All the four partners will continue to work together and manage the AMC professionally, without any support from the Government. However, the modalities of exit will depend on how the Government plans to approach the issue, Mr Murthy said.

The process of the Government exiting the fund is likely to be completed before January 2006.

Referring to the Sensex zooming past the 8,000-point mark, Mr Murthy said there is nothing to worry as stocks are quoting at a price equity ratio of 16 and that augured well for the markets and investors.

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