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India’s shadow lenders are facing a fresh threat, just as they were starting to recover from the fallout of landmark defaults last year by one of their own.
The lenders could come up against a new cash shortage, if concerns about debt at conglomerate Essel Group ricochet through India’s money markets, according to Citibank and Credit Suisse. There’s reason to think that may happen, the argument goes, after Essel’s billionaire founder Subhash Chandra said on Friday that it has increased debt levels and a diminished ability to service borrowings.
Here’s how things could get ugly: Mutual funds hold a lot of debt
