Kotak Mutual Fund defends call, assures fixed maturity plans investors

Kotak MF's FMPs had 8-10% of assets exposed to Essel group entities

Kotak Mutual Fund (MF) in an investor call on Friday reiterated that the decision to hold back investor units partially in the fixed maturity plans (FMPs), on account of exposure to the papers of troubled Essel group, was taken in the best interests of the unitholders.

Speaking on the call, Nilesh Shah, managing director of the fund house, said: “We had two choices as lenders. Either convert the notional loss into actual loss or give time to the promoters. We thought the second option is better as it would give us a shot at recovering all dues, rather than risk sub-optimal