Muthoot Finance Ltd, a Kochi-based finance company, plans to raise upto Rs 1,000 crore through non-convertible debentures (NCD) to fund business growth.
The company will issue secured redeemable non-convertible debentures. The issue has a base issue size of Rs 100 crore with an option to retain oversubscription upto Rs 900 crore aggregating up to a tranche limit of Rs 1,000 crore.
The issue opens on September 27, 2019, and closes on October 25, 2019, with an option to close on an earlier date or a later date as may be decided by the board of directors or NCD committee.
There are ten investment options for secured NCDs with ‘monthly’ or ‘annual’ interest payment frequency or ‘on maturity redemption’ payments with effective yield per annum ranging from 9.25 per cent to 10 per cent.
George Alexander Muthoot, Managing Director, Muthoot Finance, in a statement, said the issue would help the company have long-term funds and diversify the borrowing basket as well.
These debentures provides an opportunity to retail and high networth individual investors (HNIs) stable and attractive long-term returns. Eighty per cent of the total issue size is being offered to them.
The issue is rated by two credit rating agencies — CRISIL Ltd and ICRA Ltd. Both agencies have assigned long-term debt rating of ‘AA/Stable’ for the debentures offered under the issue.
The rating scale denotes a ‘high degree of safety regarding timely servicing of financial obligations and very low credit risk’, the company added.
Source: Business-Standard