PSEs free to park funds in any MFs

Navratna and miniratna central public sector enterprises (CPSEs) will have the autonomy to invest their surplus funds in mutual funds of their choice. The government has allowed CPSEs to park 30% of their cash surplus either in equity or debt instruments or money market mutual funds. The centre has clarified that the overall cap of 30% is applicable for investment in public sector mutual funds as a whole and not just equity schemes of public sector mutual funds. “The government has not prescribed any individual cap on investment in equity or debt related mutual funds. CPSEs can put their entire money in either of them subject to the limit of 30%,” an official in the department of public enterprises (DPE) said. Earlier in August last year, the government had allowed PSUs to invest in equity schemes of Sebi-regulated public sector mutual funds. None of the central PSEs were, however, able to put in their money in mutual funds in the past eight months owing to ambiguities in the guidelines. Now, with almost all the ambiguities being cleared, PSUs can begin with their investments. “We received requests from several ministries and PSUs about the limit. Subsequently, it has been clarified that CPSEs can invest even in debt and money market related schemes of mutual funds,” the official said.