Debt schemes which held Jindal Steel & Power (JSPL) securities took a hit as the fund houses were forced to mark down the value of their holdings after Crisil downgraded its ratings on the company.
Select debt schemes of Franklin Templet on Mutual Fund, which has the highest exposure to JSPL papers among domestic asset managers, saw their net asset value (NAV) dip by 0.75-1.5% on Wednesday. ICICI Prudential's fixed maturity plans (FMPs), which held JSPL securities, saw their NAVs dip by up to 3% on Tuesday.
Mutual funds have been busy meeting distributors, asking them to assuage investor concerns. Franklin Templeton, in a note emailed to all distributors, defended its investments in JSPL, "Investors may note that it is a performing debt security and the impact on price is solely driven by the recent rating action. We continue to take comfort from the operating track record of management and promoter.
