Non-convertible debentures issued by real estate developers are a high-return, high-risk investment. These Real Estate NCDs are used to raise short-term secured loans from investors.
Bloomberg utilized Morningstar data as on March 31, 2019, and noted that mutual funds’ investment in real estate debt accounts for 2% of the industry’s exposure to longer-dated paper. Total assets of income and liquid schemes, which invest in long-term debt, stood at Rs 10.9 lakh crore as of March (Association of Mutual Funds in India – AMFI). Of this, the market value of investments in Real Estate NCDs is Rs 21,462.8 crore.
The schemes with exposure over 15% of their assets, according to March 31, 2019 portfolios
![THE FINAL](http://inmbweb1.morningstar.com/wordpress/wp-content/uploads/2019/05/THE-FINAL.png)
The exposure of AMCs to Real Estate NCDs, according to portfolios of March 31, 2019
![NCD1](http://inmbweb1.morningstar.com/wordpress/wp-content/uploads/2019/05/NCD1.png)
Exposure to issuer, as on March 31, 2019
![NCD TAKE THIS](http://inmbweb1.morningstar.com/wordpress/wp-content/uploads/2019/05/NCD-TAKE-THIS.png)