Franklin Templeton MF disclosed default of maturity payments of Rs 616 crore on the zero-coupon bond exposures to Essel Infraprojects. These debt papers were held in 4 of the 6 schemes being wound-up on April 24. The schemes holding NCDs include Franklin Low Duration Fund, Short Term Income Plan, Credit Risk Fund and Dynamic Accrual Fund. The NCDs had been written down by 85% at Rs 92 crore in the portfolios. The fund said the event does not have any impact on the NAVs of the schemes but that is only partly the truth because investors have already taken a hit of 85%. The NCDs issued by Essel Infraprojects are backed by a pledge of shares of Zee Entertainment and Dish TV. It was this very case of Essel Infra that had resulted in a standstill agreement signed by debt funds in the past. The next step will be to get the unit holders to vote in favour of dissolving the investments but that would be tough as most investors plan to go to court.