India's market regulator is unlikely to grant special exemption to mutual funds if they violate the maximum permitted holdings norms in securities after the merger of HDFC Bank and HDFC. These banks, both heavily owned by mutual funds, will soon merge to become India's second-largest financial institution, after the State Bank of India. However, the new limitations on mutual funds could put pressure on holdings or pose limits on increases, which could be a burden on the merged entity's stock. At least 60 equity mutual fund schemes could see their consolidated exposure to HDFC Bank and HDFC go over the 10% threshold as of Wednesday.