Shubham Jaiswal (firstname.lastname@example.org)
HDFC Asset Management Company has reported a mark-to-market loss of around ₹120 crore on the Essel group’s non-convertible debentures (NCDs)—that it took on its books in June 2019— for the fourth quarter of financial year 2020. With the ₹25-crore loss that the AMC took in the previous quarters, the total valuation loss comes to ₹145 crore.
In June 2019, the AMC had moved ₹500 crore worth of Essel paper from its schemes to its own books. This implies that it has altogether taken a valuation loss of 30% on the debt.
According to a person with knowledge of the matter who declined to be named, the loss was most likely on account of decline in the value of Zee Entertainment and Dish TV shares that may have been offered as collateral. Zee Entertainment’s shares have collapsed from ₹361 to ₹164.90 over the past one year, while Dish TV has fallen from ₹31 to ₹4.6 during the same period.