Investors in two out of the six debt schemes which might be being wound up by Franklin Templeton Mutual Fund may get as a lot as 7-9% of their money back by the primary week of July. Franklin Ultra Short Term Fund and Franklin Dynamic Accrual Fund have acquired money, in accordance with their portfolios as on May 31.

Investment advisers mentioned this means the borrowings these funds had carried out have been repaid. But the reimbursement schedule will depend upon the result of the e-voting by unitholders approving the winding up of schemes. The course of will be held between June 9 and 11. The trustees can promote the securities solely after they obtain approval.

“Each scheme has its own maturity profile and in general, shorter duration schemes will be able to return monies to investors faster. The schemes continue to receive regular coupon payments and maturities. We believe that the person(s) authorised by unitholders will explore all appropriate opportunities to monetise underlying assets in the portfolio, such that it can return investor monies at the earliest possible time,” mentioned a spokesperson for Franklin Templeton.

He added that two of the six schemes have already repaid their financial institution borrowings and are cash-positive now. These schemes can begin repayments to traders shortly, topic to a profitable unitholder vote.

“FT Ultra Short Bond Fund will have a cash of 9% while in the case of FT Dynamic Accrual, it will be 7.5% by June 30, 2020,” mentioned Amol Joshi, founder, Plan Rupee. The fund home is more likely to pay out as a lot as attainable to schemes as and when it has money.

Borrowing in Ultra Short Fund with property beneath administration of Rs 9,600 crore was at 6.58% of the property on April 23 when the fund home introduced the winding up of the schemes. The borrowing fell to five.34% on April 30 whereas on May 31, the place turned cash-surplus at 2.92%. In the identical interval, the Dynamic Accrual Fund had borrowing of 1.41%, which rose to 2.38%, and became 4.48% money by May 31.

As per the maturity profile of the portfolios specified by the fund home, in June 2020, Ultra Short Term has maturities of 6% of its corpus whereas for Dynamic Accrual Fund, it’s 3%.

Once the fund home will get an approval from unitholders to wind up the schemes, it may additionally take a look at promoting securities in the market or negotiate with the issuer for early reimbursement.

In the opposite 4 schemes, borrowings proceed to be excessive, although they’re down from April 23. This means the await traders may very well be increased right here. The borrowings stood at 7.5% in Franklin Low Duration, 29.4% in Franklin India Short Term, 34.4% in Franklin India Income Opportunities and eight.74% in Franklin India Credit Risk Fund on May 31.