MUMBAI: The finance ministry has advised the Unit Trust of India to step up the repurchase price of US-64 units in November. The ministry also wants the trust to maintain its 20 per cent dividend on its flagship scheme. "This is part of a carefully laid-out confidence-building exercise to tide over the present crisis," a finance ministry source said. Finance secretary Vijay L Kelkar will be in Mumbai on Wednesday to conduct a stock-taking exercise at UTI. According to sources, it will be an exclusive meeting between Kelkar and UTI chairman P S Subramanyam. Banks and financial institutions and even the Reserve Bank of India will not attend the meeting. Kelkar skipped the Reserve Bank board meeting in Hyderabad last week, busy with the fire-fighting exercise in the capital. According to sources in Delhi, the meeting between Kelkar and the UTI top brass will focus on corporates' as also retail investors' rush to redeem US-64 units and the ways to boost investors'confidence.

A string of public sector banks led by the State Bank of India is expected to pump in close to Rs 1,000 crore by October 31 through fresh buying of US-64 units. This will neutralise the effect of "large-scale" redemptions that have taken place this month, sources said. In November, the sale price is likely to be pegged anywhere between Rs 14.70 and Rs 14.75 and the repurchase prices between Rs 14.40 and Rs 14.45. The Reserve Bank of India has decided to keep a close tab on the functioning of the UTI by calling upon the behemoth to provide all relevant information, including the net asset value of the US-64, in exercise of its powers under Section 29 of the UTI Act, 1963.

Essel in Germany

MUMBAI: Essel Packaging Ltd, (Essel), India's largest manufacturer of laminated and seamless tubes is setting up a manufacturing plant in Dresden, Germany in association with a Munich-based commercial organisation called Argenta Internatinal. The agreement to this effect had been signed recently.Thetotal cost of the project is around Rs 42.5 crore. The new company will have an equity base of Rs 13 crore and the remaining will be raised through loans, according to a company press release. The plant will be located at Dresden, which is one of the fastest developing areas in the erstwhile East Germany. The plant will supply laminated tubes to customers in Germany and other European countries.