Muthoot Finance has launched its 28th public issuance of secured redeemable non-convertible debentures (NCDs) with a face value of $1,000 each and a base issue size of 75 crores, with an option to retain oversubscription up to 225 crores, aggregating to a tranche limit of 300 crores. The cash raised will be used largely for the Company’s lending activities.
According to a business spokeswoman, this issue will be open from Thursday and will close on October 28th, with the potential to close on an earlier or later date as determined by the board of directors or the NCD committee. ICRA has assigned the proposed NCDs an AA+ (Stable) rating, indicating a “high degree of safety regarding timely servicing of financial obligations.”
The main criterion for allocating the proposed NCDs to investors is first come, first served. Individual investors have seven investment alternatives for secured NCDs with monthly or ‘annual’ interest payment frequency or ‘on maturity redemption’ payments, with coupons ranging from 7.50% to 8.00% p.a.
Muthoot Finance Ltd’s George Alexander Muthoot, MD, expressed confidence that this edition of NCDs will see a large number of subscriptions due to the company’s AA+/stable ICRA rating and excellent interest rates. “We have reserved 90% of the offer for retail and high-net-worth individual investors, who will receive 0.5% p.a. higher than the interest rate available to institutions and corporations.”
As a result, we anticipate a positive response to the issue. When compared to similar existing routes, investors are bound to regard this as a terrific investment prospect,” he noted. The issue’s lead manager is AK Capital Services, while the debenture trustee is IDBI Trusteeship Services.
