The financial sector is waiting for Friday when UTI will hold the board meeting to finalise the dividend payout for US-64, while sale and re-purchase prices will also be fixed.

Sources said the Trust cannot afford to price its units too high in July as that would mean a movement of funds away from the Trust towards banks' fixed deposits.

Banks are now offering a maximum of 10 per cent on one year deposits and the UTI has to offer a higher yield if it has to maintain its edge. Assuming a minimum yield of around 11.5 per cent, based on sale price of Rs 14.70 in November last year, the Trust would have to declare a dividend above 15 per cent- `say, round about 16 per cent', said asource.

Sources, however, said that even with a relatively low 15 per cent dividend payout, UTI would have to fix its July price at around Rs 16, which could be steep enough to deter prospective investors.

UTI is also constrained by the fact that it has to follow the recommendations made by Deepak Parekh committee and link its re-purchase price with the scheme's net asset value (NAV). At present the NAV of US-64 is under Rs 14, according to sources. Though UTI has been granted a three-year time-frame in which to align its repurchase price with the NAV, the general indication is that the Trust would like to start on cleaning up its act now itself.

So with a re-purchase price of Rs 14, the sale price can be fixed at somewhere between Rs 14 and 15 which is not an unreasonable proposition, market analysts argued.

The main thing is to revive the confidence of investors that might have been shaken by the bad press which the scheme has been receiving coupled with the fears of a lower dividend for theyear.

Incidentally the scheme has been declaring a dividend of 20 per cent for the last three years. The appreciation in the value of scrips belonging to public sector units (PSUs) in the scheme's investment portfolio is a boost as it has already resulted in a reduction in the quantum of government bailout by Rs 1,500 crore from the earlier committed Rs 4800 crore.