A report by Crisil has highlighted the rating and liquidity profile of debt in various mutual fund categories, pointing out those, which are most exposed to credit risk. It also noted wide variations in individual schemes in different categories, suggesting that opportunities in debt funds are there if debt categories and schemes are carefully filtered.
According to the report, from July 2018 to February 2020, as many as 22 companies held by mutual funds defaulted. The damage from these defaults aggregates to ₹17,700 crore. Just four entities—IL&FS, DHFL, Reliance ADAG and Yes Bank accounted for about ₹16,000 crore of defaults.
