The mutual funds industry has not seen much growth over the last few years. How is UTI going to cope with the situation?
As the interest rates harden and yields on government securities go up, the net asset values will decline. So there will be an outflow of money from debt to equity funds. Now UTI has not grown because the entire mutual fund industry has not grown. But if you look at UTI's new avtaar -- when it started it was ahead of its nearest competitor by Rs 3,000 crore in terms of total corpus. Now it is ahead by Rs 5,000 crore. So among the funds UTI has increased the distance. Even now we are waiting to see the fine print of the Finance Bill and the investment in equity linked savings schemes. We could really see the entire mutual-fund corpus grow this year. There is also considerable interest from Japanese and Swiss institutions in the Indian markets and the going looks good for the immediate future.
Don't you see the high oil prices affecting the economy?
Well, the oil prices have softened. But it will be interesting to note that if these soft trends persist then oil prices might fall a bit in a hurry. There are a lot of hedge funds that have invested on the basis of a high price fore cast. If the price trends remain soft for a while, the more cautious of these funds will be in a hurry to get out.
Do you see a future for an alternative third stock trading platform in India?
The regional bourses are now virtually defunct, but what remains are the huge real estate that belongs to these exchanges. With the brokers being members as well as shareholders in these exchanges, there is some interest in this community about the property after the exchanges become defunct as Sebi is stressing on de-mutualisation. I do not see a future for a third platform.