Mutual funds having exposure to Vodafone Idea’s corporate papers and shares are staring at possible losses as an adverse judgment from the Supreme Court threatens to down the curtains on the business.
The telco’s survival will now depend on its ability to garner funds to pay the statutory dues and repay what it had borrowed from the market.
The government has estimated Vodafone Idea’s dues at over Rs 53,000 crore, including over Rs 28,000 crore in licence fee, interest and penalties and the rest on spectrum usage charges. Besides, the company’s total debt stood at Rs 1.15 lakh crore at the end of FY2019, shows available data.
Mutual fund investors have already taken the first hit from this, after Franklin Templeton India marked down its Vodafone Idea debt exposure to zero as a pre-emptive measure. It has also limited fresh inflows to the schemes having Vodafone Idea papers to Rs 2 lakh per day per fund per investor.
“The large quantum of AGR dues and immediate payment timeline is resulting in significant uncertainty with respect to our exposure to Vodafone Idea,” Franklin Templeton said.
Following these actions, net asset values (NAVs) of six of its funds have fallen 4-7 per cent due to the one-time write-off. As of January 16, total exposure of
The telco’s survival will now depend on its ability to garner funds to pay the statutory dues and repay what it had borrowed from the market.
The government has estimated Vodafone Idea’s dues at over Rs 53,000 crore, including over Rs 28,000 crore in licence fee, interest and penalties and the rest on spectrum usage charges. Besides, the company’s total debt stood at Rs 1.15 lakh crore at the end of FY2019, shows available data.
Mutual fund investors have already taken the first hit from this, after Franklin Templeton India marked down its Vodafone Idea debt exposure to zero as a pre-emptive measure. It has also limited fresh inflows to the schemes having Vodafone Idea papers to Rs 2 lakh per day per fund per investor.
“The large quantum of AGR dues and immediate payment timeline is resulting in significant uncertainty with respect to our exposure to Vodafone Idea,” Franklin Templeton said.
Following these actions, net asset values (NAVs) of six of its funds have fallen 4-7 per cent due to the one-time write-off. As of January 16, total exposure of
