NAV ‘s of 3 BOI AXA Debt Schemes fall after fund house marks down exposure

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The net asset values (NAVs) of three BOI AXA debt schemes — BOI AXA Credit Risk Fund, BOI AXA Conservative Hybrid Fund and BOI AXA Short-Term Income Fund — fell in the range of 2-50 percent on April 23 after the fund house said it will markdown its exposure in select debt securities held in its portfolio.

In another major fallout of the coronavirus crisis, the net asset values (NAVs) of three BOI AXA Mutual Fund’s debt schemes drastically fell after the fund house announced the marking down of its exposure in seven securities across its portfolios which are listed as follows.

The fund house on Friday wrote down its entire holding in Dewan Housing Finance Corporation Ltd (DHFL) and Avantha holdings from earlier levels of 75 per cent. It also increased its haircut in three papers — RKV Enterprise, Accelarating Education and Development, Coffee Day Natural Resources — from the previous 50 per cent to 90 per cent. BOI AXA also marked down its exposure to Dinram Holdings Private Ltd and Amantha Healthcare by 50 per cent and 75 per cent respectively.

“Considering the severe illiquidity in the debt market, it’s estimated that the securities in the portfolio may not be reflecting the realisable value that should form the basis of valuation of NAV of the funds where these securities are held,” BOI AXA said in a statement.

For more relevance, Franklin Templeton Mutual Fund has six such FoFs which saw sharp declines on account of their holding of the 6 Franklin debt schemes which are being wound up which may be an effect over the NAV fall out of the BOI as the debt market industry is too uncertain about the ongoing situations.

“The future too looks uncertain and any extention of lockdown in certain parts of the country will out further strain on the industrial output and demand metrics impacting companies’ ability to service their borrowings and debt obligations. Taking all these conditions into account, investors are moving to safer assets till the situation improves,” company stated.

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