Largest gold financing company in India Muthoot Finance Ltd. will open the public issue of its Non-Convertible Debentures - Secured and Unsecured (NCDs) from today.
The company will announce its 16th series of Public Issue of Non-convertible Redeemable Debentures.
It has filed a shelf prospectus for issue of Secured Redeemable Non-Convertible Debentures ("Secured NCDs") of face value of Rs. 1,000 each aggregating up to Rs. 1300 crore and Unsecured Redeemable Non-Convertible Debentures ("Unsecured NCDs") of face value of Rs. 1,000 each aggregating up to Rs. 100 crore, totaling up to Rs. 1400 crore ("Shelf Limit").
The Tranche issue is with a base issue size of Rs. 200 crore with an option to retain oversubscription up to shelf limit of Rs. 1400 crore ("Tranche I issue").
The issue opens on January 17, 2017 and closes on February 17, 2017 with an option to close earlier and/or extend up to a period as may be determined by a duly authorized committee of the board.
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The issue is rated by two Credit Rating Agencies - CRISIL and ICRA. Both agencies have awarded long term debt rating of 'AA/Stable' for the debentures offered under the issue. The rating scale indicates 'High degree of safety regarding timely servicing of financial obligations and very low credit risk'.
The NCDs are proposed to be listed on BSE Limited.
There are ten investment options for Secured NCDs with Monthly or Annual interest payment frequency or on maturity redemption payments with effective yield p.a. ranging from 8.25 percent to 9.25 percent for retail investors.
The investment option for Unsecured NCDs is a scheme which doubles the invested amount in 96 months with an effective yield p.a. of 9.06 percent for retail investors.
The funds raised through this issue will be utilized primarily for lending activities of the company.
The lead managers to the issue are Edelweiss Financial Services Limited and A. K. Capital Services Limited. IDBI Trusteeship Services Limited is the Debenture Trustee. Link Intime India Private Limited is the Registrar to the Issue.
"This is the first public issue by the Company after rating upgrade by CRISIL and ICRA on our long term debt instruments to 'AA/Stable'. Given the current liquidity condition and low interest rates offered on bank deposits, the rate of interest offered in the current issue will be an attractive investment option for retail investors. We have allocated 70 percent of the issue for retail investors," said George Alexander Muthoot.
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