UTI Master Share is an equity fund that preceded the birth of the capital market regulator by nearly six years and the mutual fund regulations by a decade.
The country’s first diversified mutual fund scheme, which was launched in October 1986, just completed 30 years in business and is still going strong though it no longer enjoys monopoly like the old days and faces competition from other funds.
The long track record of the fund can be gauged from the fact that if a person would have invested Rs.10 lakh in the scheme in 1986, it would have been worth Rs.6.96 crore as on September 30. Further, despite its age of 30 years, it has been able to generate a compound annual growth rate (CAGR) of more than 15 per cent.
The fund has been quite benevolent in the terms of rights, bonus and dividend payouts as well. According to the fund house, every Rs.10 invested in the scheme has resulted in a dividend of Rs.123 till date.
Wealth creation“The fund has weathered many storms of the equity market and has been consistent with wealth creation for those that stayed invested in the scheme,” says Swati Kulkarni, who has been managing the fund for the last 10 years.
Incidentally, her brush with the fund happened in 1986 itself as her father was among the early investors in the scheme. She still has her own investments in the scheme.
While the scheme has a diversified profile, the temptation towards mid-caps was resisted even in the years when the segment registered a strong rally. The scheme has a universe of 45-50 stocks with 80 per cent allocation towards large-caps.
As on 30th April 2016, UTI Master Share had a corpus of Rs.3,103 crore with more than 5.12 lakh investors. The fund size may pale when compared to many other available funds, but it does not take away the fact that it still has some loyal investors.
Nasik-based Pramod Puranik invested Rs.10,000 in 1986 and is still putting in Rs.10,000 every month by way of SIPs – systematic investment plans.
Bonus issues“Those who invested in 1986 got the entire principal back by way of rights and bonus issues. The scheme has an unparalleled record of dividend payouts, which make it one of the best schemes. My investments in the scheme total Rs.10 lakh and I have no intention of stopping my SIPs as well,” says the 63-year old Mr. Puranik.
Incidentally, over the last few years the fund has been timing its dividend payout just before Diwali – also the time when most companies give bonuses to their employees.
Dhirendra Kumar, Chief Executive Officer of Value Research, a leading mutual fund tracker, says that while the fund has a good track record, the present day investor is spoilt for choices with many better performing funds as well.
“UTI Master Share is a decent fund with a long history and its share of ups and downs. The last 4-5 years have been quite impressive. It deserves credit for being a conservatively managed and reasonably diversified fund. Despite the history and the goodness, it is not the best performing in its category and those looking for investment options have a problem of plenty,” he says.
That does not deter UTI Mutual Fund, which has initiated a special marketing campaign to promote the scheme, which includes incentives for distributors and financial advisors for getting more flows.
