Muthoot Fincorp, a non-banking finance company (NBFC) is set to launch a secured, redeemable, non-convertible debentures, which will offer effective yield in the range of 8.3-9.37 per cent. The public issue of the NCDs will be open for subscription from January 5 to January 28, 2022. The face value of each NCD is ₹1,000.
The base size of the issue is ₹200 crore with a greenshoe option to raise it to ₹400 crore.
The prospectus filed with SEBI states that the company shall maintain a minimum 100% security cover on the outstanding balance of the NCDs plus accrued interest thereon.
The issue comes with five different tenures – 27, 38, 60, 72 and 96 months – with both monthly pay-out and cumulative option. The issue has been rated A+ with a stable outlook by CRISIL. Instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations and carry low credit risk. Note that, instruments with the AAA rating have the highest degree of safety and carry lowest credit risk.
The minimum application shall be 10 NCDs, that is ₹10,000 (across all Options of NCDs). The aggregate value of applications from individual residents or HUFs cannot be more than ₹10 lakh.
The NCDs shall be listed on BSE within 6 Working Days of Issue Closure.
The debenture holder may nominate, in the Form No. SH.13, any one person in whom, in the event of the death of applicant the NCDs allotted, if any, will vest. Where the nomination is made in respect of the NCDs held by more than one person jointly, all joint holders shall together nominate in Form No. SH.13 any person as nominee
The funds raised through the issue will be used for the purpose of working capital and general corporate purposes.
Muthoot Fincorp is a non-deposit taking, systemically important NBFC registered with the RBI engaged in the gold loans business for over a decade and is headquartered in Kerala.