UTI's global arm eyes Gulf growth

Dubai: UTI International Ltd, a 100 per cent subsidiary of UTI Asset Management Company Ltd., the largest retail asset management company in India, sees strong growth for its investor base in the Gulf region in the coming months.

"The resilience of the Indian economy, strong corporate performance and the rebounding of the stock markets have once again proved the underlying strength of the investment opportunities in India. The global financial crisis has once again proved the credibility of India's growth story abroad," Tarun Ghulati, Chief Executive of UTI International told Gulf News.

UTI International, the Guernsey-registered off-shore subsidiary of UTI Asset management, has nine active funds including an Islamic fund that has fully Sharia-compliant India-based underlying assets.

Retail investors

While UTI International sees structuring of more new Sharia-compliant products targeted at Middle East investors, the company's top management expects to attract a significant number of institutional, high networth and retail investors to its funds.

"Clearly providing more Sharia-compliant opportunities in the Middle East is an option. We also see strong demand for Indian market opportunities coming from institutions, regional retail investors and high networth non-Indian expatriates who are now well aware of Indian opportunities," said Ghulati.

Most the UTI offshore funds have outperformed the market benchmark on a five-year horizon.

The UTI India Fund has maintained its consistency in outperforming the benchmark right from three months to five years.

In September, the fund trimmed its weightage in banks, textiles and IT while increasing its weightage in autos and agro related sectors.

This fund is an open-ended multi-class investment company incorporated in Mauritius and invests in India through a domestic scheme managed by UTI Asset Management Company Ltd.

The fund has a good blend of large-cap and mid-cap stocks which has driven the performance of the fund. "The India fund is a very good investment vehicle for global investors to participate in the India growth story," he said.

The India Pharma Fund is an open-ended fund incorporated in Mauritius that invests substantially all of its assets in India through a domestic scheme managed by UTI Asset Management Company Ltd.

Most of the fund's exposure is to equity and equity-linked securities of Indian pharmaceutical companies listed in India.

The pharma fund has performed consistently in the past. The pharma sector continues to attract interest on account of the strong growth prospects and reasonable valuations. The fund continues to be overweight on its key mid cap equities.

With the deal flow to the major IT companies improving, the India IT Fund, an open-ended investment fund that invests in mid-cap Indian IT firms, is expected to deliver handsome returns.

Realistic

Year to date, India now stands as one of the best performing markets globally. However, Ghulati is realistic about the short- to medium-term performance of the market.

"The valuations have risen too fast from their very low levels at the beginning of the year. This poses some short-term risks. However, we are convinced about the medium- to long-term Indian opportunities and expects the market to out-perform the rest of the world," he said.