The fund house is said to have already written down the full value of an estimated portfolio of about Rs 1,250 crore of Vi papers<\/a> before any redemption. The value to those securities<\/a> became nil after being separated from other financially stable portfolios.
Those papers have been downgraded to the ‘junk’ category but not 'default<\/a>'.
To be sure, Vi has been serving interest payments or repayments on those bonds on time without any delay.
About five months ago, local credit rating company CARE cut Vi’s rating to B-, deeper into the junk or high-yield category. It placed it under “credit watch<\/a> with negative implications<\/a>”.
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Improvement of the overall financial risk profile of the company on a sustained basis could lead to a positive rating action\/upgrade, CARE Ratings said.
Franklin Templeton<\/a>, SSG and Farallon did not respond to ET’s queries. Varde Partners declined to comment.
“The fund house has nothing to lose as Vi’s bond portfolio value is zero on its books. If it manages to sell, there will be additional gains,” said one of the persons cited above.
In the past two weeks, revival prospects of India’s only loss-making private telecom carrier have brightened.
Last week, the company said it would opt for converting the interest on spectrum and adjusted gross revenue (AGR) outstanding into equity, which would see the government become the largest shareholder with 35.8% stake. If the conversion goes through, UK-based Vodafone group will hold 28.5% with 17.8% held by Kumarmangalam Birla-owned Aditya Birla group. They currently own 44.39% and 27.66% shares, respectively, in Vi.