Debt mutual funds’ exposure to Coffee Day Group exceeds Rs 190 crore

Mumbai: Debt mutual funds had exposure worth Rs 193 crore to bonds of Coffee Day Group as on June 30, 2019. Three fund houses – DSP Mutual Fund, Indiabulls Mutual Fund and BOI Axa Mutual Fund – have exposure to the group through debt securities of Coffee Day Natural Resources and Tanglin Developments. Their exposure came under the spotlight after VG Siddhartha, founder of the Cafe Coffee Day (CCD), went missing amid speculation about rising debt obligations.
Mutual funds said their exposure to the group companies have adequate security cover.

DSP said its Credit Risk Fund, which had an exposure of Rs 132 crore, reduced it to Rs 80 crore after it got some repayment in July.


“We have exposure to secured non-convertible debentures issued by the Coffee Day Group. The current exposure to the group is Rs 80 crore, said a spokesperson for DSP.

BOI Axa Mutual Fund has exposure to the group's papers through its credit risk fund. “Our debt exposure is to a corporate entity and is secured by assets,” says Alok Singh, chief investment officer, BOI Axa Mutual Fund.

Indiabulls Mutual Fund has a Rs 45-crore exposure to Tanglin Development through schemes that will come up for maturity in October 2019 and January 2020. Indiabulls Short Term Fund, Indiabulls Savings Income Fund and Indiabulls Income Fund hold these securities.

Tanglin Development, a group company, runs two technology parks in Karnataka.

“Tanglin Development is a profit making entity in the business of operating IT parks and we also have a 2.75 times security cover on our investments, ” said a spokesperson for Indiabulls Mutual Fund.