DSP Mutual Fund initiates legal action against DHFL to recover dues

Litigation may delay housing financier's resolution plan

In a move that might disrupt the resolution process being worked out for Dewan Housing Finance Corporation (DHFL), DSP Mutual Fund (DSP MF) has initiated legal action against the housing finance company for recovery of its dues.

“As mutual funds are not formally bound by the inter-creditor agreement (ICA) signed by banks, they can take legal recourse to strengthen their position,” said a person in the know. DSP MF had an exposure of about Rs 169 crore, largely as non-convertible debentures (NCDs), as of April 30, according to the data published by Value Research.

The DSP MF spokesperson could not be reached