Mutual funds' exposure to corporate debt slips further, shows PRIME data

MF holding of commercial papers (CPs) has fallen 13.7 per cent in value terms, according to Prime data. 

MF holding in CPs stood at Rs 3.7 trillion in June, as against Rs 4.3 trillion in May. From its all-time high of Rs 4.9 trillion, it was down 24 per cent. The CP market — heavily used by NBFCs to raise short-term debt — has been reeling from liquidity crunch since the IL&FS crisis. The all-time high level for CP holding was seen in August, just before the crisis.

MF holding of corporate bonds stood at Rs 5.8 trillion on June 30, down 4.1 per cent from May. Data shows the top four fund houses accounted for nearly half the Rs 3.7 trillion worth of CPs held by MFs.