SEBI ruling shot down

S. Vaidya Nathan

The Securities Appellate Tribunal has set aside a part of the order on the ruling by the Securities and Exchange Board of India (SEBI) relating to transactions in the shares of Videocon International Ltd.

The SAT has upheld the appeal of the former Managing Director (Shriram Asset Management Company), Mr. D. A. Gadgil. The SAT has upheld the appeal of Mr. Gadgil that the SEBI order was passed without following the principles of natural justice.

The SAT has remanded the matter for fresh consideration by SEBI, and directed that Mr. Gadgil be given a fair and reasonable hearing. SEBI had barred Mr. Gadgil from holding a public position in any capital market-related public institution for three years. The SEBI order was passed following irregularities in the role of Shriram Mutual Fund in the purchases of Videocon shares during the payment crisis in June 1998. The fund had purchased shares at Rs. 84 per share from a broker, against the then market price of Rs. 63 per share. These transactions were held by SEBI as being detrimental to the interest of investors, and penalties were imposed on the sponsors of Shriram Mutual Fund.

Tata Income dividend: Tata Mutual Fund has announced that it would pay a dividend of 0.80 per cent under its monthly income plan of Tata Income Fund for August. The fund will also pay 2.42 per cent dividend under its quarterly income plan for the June-August period. Tata Income Fund, managed by Tata Mutual Fund, was launched in March 1997.

HDFC's big kitty: HDFC Mutual Fund garnered Rs. 600 crores through its maiden schemes, which closed for subscription on August 10. The fund launched three open-end mutual schemes -- HDFC Growth Fund, HDFC Balanced Fund and HDFC Income Fund. The Growth Fund raised 25 per cent of the amount, the balanced fund 15 per cent and the income fund 60 per cent. The fund has indicated that it would continue to focus on retail customers by further expanding its distribution network and number of investor services centres.

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MIP from Reliance: Reliance Capital Mutual Fund has launched a monthly income plan. The plan is an open-end scheme that would invest at least 85 per cent of the funds in debt instruments and has the flexibility to invest the rest in equities. The minimum investment amount is Rs. 25,000 for the monthly plan, and Rs. 5,000 for the growth plan. The fund is being offered at an exit load of 0.50 per cent, and there is no entry load.

US-64 July sales: The Unit Trust of India (UTI) has announced that sales in July were Rs. 448 crores and that it garnered Rs. 35 crores in August. The July sales was up 41 per cent over the collection of Rs. 341 crores in July 1999. The dividend re-investment is Rs. 711 crores. In 1999, the dividend re-investment amount was Rs. 644 crores.

The number of applicants in July was 97,000 against 66,000 in July 1999. According to the UTI, the fund collected Rs. 2,400 crores in April-June 2000. This accounted for 69 per cent of collections in 1999-2000. In 1998-99, sales in July (Rs. 3,218 crores) accounted for 69 per cent of the year's sales of Rs. 4,638 crores.

UTI MMMF: The Unit Trust of India (UTI) has removed the 15-day lock-in period for repurchase of its Money Market Mutual Fund (MMMF). According to the UTI move, investors can withdraw up to Rs. 20 crores per account per day on any working day. The capital of the fund at present is Rs. 363.93 crores. The MMF was an open-end money market mutual fund, launched in 1997, and invests in short-term money market instruments.

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US-64 prices: The Unit Trust of India has fixed the sale price and repurchase price for US-64 at Rs. 13.65 per unit and Rs. 13.35 per unit respectively for August 2000. These prices represent a 15 paise rise over the July 2000 prices.

Wider palette from ING: ING Savings Trust plans to launch a gilt fund -- ING Gilt Fund -- in July and an equity linked saving product -- ING Taxsavers' Portfolio -- in August, 2000. ING Gilt Fund would invest exclusively in government securities, while the ING Taxsavers' Portfolio will invest up to 80 per cent in equity with the balance 20 per cent in debt and money market instruments. The fund has not set any collection targets for the two new products. As of June, ING Mutual Fund had assets worth Rs. 460 crores under management, through four funds: ING Growth Portfolio, ING Income Portfolio, ING Treasury Portfolio and ING Balanced Portfolio.