Franklin Ultra Final Payment From Vodafone Segregated Fund

Yesterday, Franklin Templeton announced that Vodafone Idea has made full payment of the principle along with interest. If you recall, a few funds from the AMC were holding Vodafone Idea papers which were downgraded to junk. As a result, Franklin has moved those papers to a segregated fund. Franklin already made a partial payment last month after it received interest payment from Vodafone. Now the AMC will be paying out the full amount from the segregated funds.


Remember that this is the payment from the segregated fund and has nothing to do with the winding up of funds. The winding up process is under judicial process and may take some time to resolve. The segregated funds don’t come under that process.


How much will I get?

This is quite simple to find out. Just get your CAMS consolidated statement. It will tell you exactly how much you will get. If you already know how many units you hold in the segregated fund, you can also use the NAV to calculate how much you will get. Franklin has already announced the NAVs of the funds and you should have received an email by now. I have published the NAV numbers below for your reference.


NAV of various segregated funds of Franklin

When and how will I get the money?

You should be receiving your investment by 14 July 2020. The amount will be deposited into the bank account that you have registered with Franklin. Remember that the cost of acquisition is considered as zero. Hence all the money you receive is considered as capital gain. Unfortunately, I am not really sure if this should be considered a short term gain or depends on the date of purchase.


How does it affect me?

For me, the timing of this could not have been better. As I mentioned in my previous post in May, I had only 4 months of monthly expenses available! With this deposit I can extend my monthly expenses by a few more months. If you recall, I have a lot of my investments locked in Franklin Ultra Short Term fund. So this is a substantial payout for me. I just need to figure out the taxes now and pay advance tax if necessary.


Update [July 12, 2020]

I have received the payout in full.


Update [July 14, 2020]

Figured out tax on the payout.


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