"We are very hopeful that the perspective and outlook on Janalakshmi Financial Services will be very different in the next six months. Once the capital raise is completed, there should be significant improvement in its credit metrics. With improved liquidity in their balance sheet, Janalakshmi Financial Services may even look at reducing their high cost borrowings from debt markets," said Pankaj Sharma, CIO-fixed income, DSP Blackrock, which has exposure to the tune of Rs 345 crore.
Two of DSP BlackRock Mutual Fund's fixed maturity plans have 12.2 per cent and 8.79 per cent allocation to Janalakshmi's debentures. Three schemes of UTI Mutual Fund, India's sixth largest fund house, have allocation of between nine to -12.5 per cent of their total corpus. Likewise, some of the schemes from the stable of HDFC MF, Kotak MF, Indiabulls MF have between eight and 10 per cent exposure. The holdings are as on June 30, 2017 and it is likely there could have been changes to the portfolio. All the fund houses couldn't be reached for a comment immediately.
"We must mistake this is just a downgrade and not a default. We will continue to hold these papers till maturity," said a fund manager with exposure to Janalakshmi.
Fund managers said they are regularly in touch with the top management and promoters of Janalakshmi and the company has so far been transparent and forthcoming.
Founded by Ramesh Ramanathan, Janalakshmi is micro finance company with urban focus. The firm is also a small finance bank license holder.
In the recent past, Sebi has been asking fund houses to be careful with their debt investments amid spiraling of bad loans in the banking sector.