The Rs 500 cr Non Convertible Debenture (NCD) issue by Commercial vehicle finance major Shriram Transport Finance Company Limited (STFC) evoked an overwhelming response and was subscribed by almost ten times on the very first day of opening on Monday.
The QIB and HNI portions were fully subscribed. Retail segment is also evoking a good response, said market sources privy to the development.
The company mopped up over Rs 5,000 cr. STFC hit the debt market Monday with the NCD offer aggregating up to Rs 500 crores with an option to retain over-subscription of upto Rs. 500 crores for issuance of additional NCDs. The NCD issue offers yield on redemption of up to 11.50% (per annum).
This Issue has been rated ‘CARE AA+’ by CARE and ‘AA (ind)’ by Fitch. The rating of CARE indicates stability and timely servicing of debt obligations and very low credit risk besides indicating high safety, sources said.
ENAM Securities Private Limited, A K Capital Services Limited, ICICI Securities Limited and Kotak Mahindra Capital Company Limited have been appointed as the Lead Managers to the Issue, while Integrated Enterprises (India) Limited will be acting as the Registrar to the Issue.
STFC intends to use the funds raised through the issuance of NCDs for various financing activities including lending and investments, subject to the restrictions contained in the Foreign Exchange Management (Borrowing and Lending in Rupee) Regulations, 2000, and other applicable statutory and/or regulatory requirements, to repay its existing loans and its business operations including for its capital expenditure and working capital requirements.