On Thursday, the mutual fund company said that it has voluntarily winded up 6 yield oriented credit funds. This comes into effect from April 23 and the company has cited financial dislocation as well as illiquidity as a result of the coronavirus pandemic.
These six funds are: Franklin India Low Duration Fund, Franklin India Dynamic Accrual Fund, Franklin India Credit Risk Fund, Franklin India Short Term Income Plan, Franklin India Ultra Short Bond Fund and Franklin India Income Opportunities Fund.
"In light of the severe market dislocation and illiquidity caused by the Covid-19 pandemic, this decision has been taken in order to protect value for investors via a managed sale of the portfolio," Franklin Templeton said in a release.
Further it said the action is limited to these funds which have exposure to low-rated funds and other equity, hybrid and debt schemes of the AMC are not affected.
It is to be noted that particularly in the fixed income category there have been faced high redemptions.
After these schemes have been closed, unit holders will be paid as per their interest in the assets of the scheme after all of the liabilities and expenses in the scheme are meeted out.