US-64; In for another bailout?
Mumbai: Another US-64 bailout may be in the offing and this time it could be of rather mammoth proportions.

While the '99 bail out of Unit Scheme 1964 cost the government of India Rs 3,300 crore, at the current net asset value levels, a bail out of the scheme may cost the government Rs 6,375 crore.
According to P S Subramanyam, chairman, Unit Trust of India, the scheme has a unit capital of close to Rs 15,000 crore and an NAV just below par.

The repurchase price of the scheme for May 2001 stands at Rs 14.25. Considering an NAV of Rs 10, which is higher than UTI's own estimate, on 1,500 crore units outstanding, the gap between the scheme's repurchase price and net asset value stands at Rs 6,375 crore.

Despite the gap, Subramanyam is confident the scheme will be made NAV-based from February 2002 in keeping with the recommendations of the Deepak Parekh Committee, appointed in the aftermath of the first US-64 crisis in 1998-99.
He is also confident the markets will recover by then, so the government will not to have to bail out UTI.

If the markets do not recover and a second bail-out does become necessary, the government will end up spending close to Rs 10,000 crore -- the combined sum of the two bailouts -- on keeping the Rs 20,000-crore scheme alive, point out market observers.
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Sensex gains 78 points
Mumbai: Sentiments remained firm throughout the day and the Sensex managed to gain an impressive 78 points on Thursday.

It was stocks like Reliance, RPL, L&T, Bhel and MTNL that were the main contributors but IT stocks like Infosys and Satyam Comp also made their contribution.
With this, the index has managed to move above its first major hurdle of 3650 points.
The next resistance will be at around 3820 points.
Among heavyweights, Reliance and RPL made smart moves.
HLL remained dull with the trend likely to continue. ITC remained weak and the position will not improve unless the level of Rs 785 is crossed.
MTNL also improved during the second half of the day.
Tisco remained firm and a consolidation is likely in the range of Rs 133- Rs 145. Bhel improved smartly and the outlook for Cipla and Tata Tea also appeared positive.
Cement stocks performed impressively. Barring Gujarat Ambuja, all other stocks gained smartly. The outlook for these counters remained positive. Infosys gained 3 per cent but the outlook is yet to improve.
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