MF exposure to stressed derivatives strategies firms at over Rs 20,000 cr

The downgrade of Anil Ambani group companies' financial arms —Reliance Home Finance and Reliance Commercial Finance —has again put the spotlight on mutual funds' (MF) debt exposures to the stressed groups.
 
Data from Value Research and Morningstar shows that MFs’ exposure to these groups —Infrastructure Leasing & Financial Services (IL&FS), Essel group, Dewan Housing (DHFL) group and Anil Ambani group —stands at over Rs 20,000 crore.
 

Illustration: Ajay Mohanty

Among these, fund houses have the largest exposure to DHFL group (Rs  7,427 crore). The housing finance company has been facing concerns over its asset-liability mismatch as it grapples with its debt obligations.
 
The non-banking financial companies (NBFC) space is under stress since the IL&FS crisis unfolded in September.
 
Credit Suisse, in a recent note, pointed out that over the next 3 months, over Rs 1.3 trillion of MF borrowings extended to NBFCs are set to mature.
 

MFs’ exposure to the two recently downgraded financial arms of the Anil Ambani group stood at Rs 2,475 crore, at the end of March. Overall, their exposure to the Anil Ambani group stands at over Rs 5,000 crore, according to Morningstar data.
 
Essel is the other group facing debt trouble, to which MFs’ exposure stands at Rs 6,779 crore, shows data from Value Research.