Incred Finance plans to raise Rs 300 crore via non-convertible debentures

Incred Finance announced on Friday that it aims to raise funds of up to Rs 300 crore through a public offering of non-convertible debentures (NCDs) starting from October 25. The issue is scheduled to close on November 7.

The NCDs are divided into three maturity options of 18 months, two years and three years. The base issue size is set at Rs 150 crore, and there is a green shoe option that allows for an additional Rs 150 crore, bringing the total fundraising to Rs 300 crore, the company said in a release.

The company plans to allocate 75 per cent of the net proceeds for purposes such as onward lending, financing and the repayment of existing borrowings, including interest and principal. Additionally, a maximum of 25 per cent will be earmarked for general corporate purposes, according to the release.

The effective yield offered to NCD holders varies based on different categories and ranges from 9.88 percent to 10.29 per cent per annum.

The outstanding debt of the company stood at Rs 3,717 crore in the first quarter of the current financial year. The AUM stood at Rs 6,484 crore in the same period.

Bhupinder Singh, whole-time director and chief executive officer of InCred Financial Services Limited, said that the company is expected to surpass the industry standards in terms of AUM.

The company said it had a product mix of personal loans, student loans, school financing and loan against property (LAP), among others. For the first quarter of the ongoing financial year (Q1 FY24), the company said it had disbursed Rs 1,887 crore and had an Asset Under Management (AUM) of Rs 6,484 crore. The company said its gross NPA and net NPA were pegged at 2.4 per cent and 1.1 per cent, respectively, for the same period.

“We continuously leverage technology and data science to make lending quick, simple and hassle-free. A key component of our growth so far has been the success of our liabilities strategy, and this public issuance of NCDs will play a role in further diversifying and strengthening our borrowing mix,” Singh said.

The NCDs have been given the rating of 'A+' with a 'Stable' outlook by CRISIL.

The book-running lead managers of the issues were JM Financial Limited.