The six debt schemes of Franklin Templeton Mutual Fund whose winding-up plan is stuck in legal uncertainty have received cash flows worth Rs 2,667 crore since April 24. This is about 10 per cent of the Rs 26,000 crore that the fund house owes investors. The money received is on account of maturities, principal repayments and prepayments.
Among the six schemes, Franklin India Ultra Short Bond Fund has the highest — Rs 1,393 crore or 14.25 per cent — cash in its portfolio, while Franklin India Dynamic has 5.65 per cent cash in its portfolio, according to a study of their portfolios as on June 30. The other four schemes are yet to repay their borrowings, though there has been a dip in the liabilities.
The percentage of borrowings in comparison to their assets under management (AUM) is the highest for Franklin India Income Opportunities at 37 per cent. That ratio is 7 per cent in Franklin Low Duration Fund, 29 per cent in Franklin India Short Term and 9 per cent in Franklin India Credit Risk.
Despite being cash-surplus, the two schemes cannot pay cash to unitholders because the Supreme Court has transferred all investor petitions against Franklin’s move to scrap the schemes filed across various courts to a bench of the Karnataka High Court. All the matters will be decided within three months. Cash in the schemes can be paid to unitholders only after receiving consent through e-voting. The e-voting and unitholders’ meet for the six schemes under winding up cannot be conducted until the court gives its verdict.