Financial Cos’ Rs61,911cr CPs with mutual funds due to mature in next 15 days

The Indian mutual fund industry had Rs4.4 lakh cr worth of Commercial Papers (CPs) as on October 30, 2018, approx. 18% of the total AUM.

Nov 15, 2018 12:11 IST India Infoline News Service

Nearly Rs61,911cr worth of CPs of financial companies (with mutual funds) are due to mature in the next 15 days. The Indian mutual fund industry had Rs4.4 lakh cr worth of Commercial Papers (CPs) as on October 30, 2018, approx. 18% of the total AUM.
 
Mutual fund houses are showing lower confidence in fresh CPs, particularly those of NBFC and Housing Finance Companies (HFC) after the IL&FS fiasco led to a rise in yields. Besides, the rising redemption from debt funds has also magnified the impact.

As per AMFI data, liquid funds witnessed a record net outflow of Rs2.1 lakh cr in September 2018 due to the panic created by the IL&FS default. This led to a reduction in liquid funds' net inflows in October 2018 at only Rs55,296cr, signifying that investors are cautious of investing in liquid funds.

Besides, income funds have also been witnessing net outflows because of poor returns due to rising yields. A total of Rs1.2 lakh cr was flown out of income funds in the current fiscal year.

The situation for the NBFC and HFC is critical since the above-mentioned factors will increase their cost of funding. Here is a list of top financial companies whose CPs with mutual funds are due to mature in the next 15 days.
CPs with mutual funds due to mature in next 15 days (company-wise)
Company Name Market Value (Rs Cr)
HDFC Ltd. 6,147
REC Ltd. 4,973
Shriram Transport Finance Co Ltd. 3,693
India Infoline Finance Ltd. 2,975
LIC Housing Finance Ltd. 2,933
Gruh Finance Ltd. 2,764
PNB Housing Finance Ltd. 2,064
Power Finance Corp Ltd. 1,989
L&T Finance Ltd. 1,816
Hero FinCorp Ltd. 1,692
Aditya Birla Finance Ltd. 1,691
Bajaj Finance Ltd. 1,642
Edelweiss Commodities Services Ltd. 1,457
Tata Capital Financial Services Ltd. 1,418
Tata Motors Finance Ltd. 1,356
Mahindra & Mahindra Financial Services Ltd. 1,293
Indiabulls Commercial Credit Ltd. 1,224
IIFL Home Finance Ltd. 1,048
Piramal Capital & Housing Finance Ltd. 969
Aditya Birla Capital Ltd. 935
ECL Finance Ltd. 904
IIFL Wealth Finance Ltd. 895
Bajaj Housing Finance Ltd. 895
Manappuram Finance Ltd. 846
Housing & Urban Development Corporation Ltd. 845
Indiabulls Housing Finance Ltd. 828
DHFL 698
Tata Motors Finance Solutions Pvt. Ltd. 696
Axis Finance Pvt. Ltd. 622
Capital First Ltd. 596
Trapti Trading & Investments Pvt. Ltd. 523
(Source: AceMF, IIFL Research)

Related Story