Muthoot Finance Looking To Raise Rs 700 Cr Via Issuance Of Non-Convertible Debentures

Muthoot Finance Ltd, on Thursday,  unveiled its 32nd series of public issuances featuring secured redeemable non-convertible debentures, each with a face value of Rs 1,000. The initial size of this issuance is Rs 100 crore, and there is a provision to accommodate oversubscription, extending the total tranche limit to Rs 700 crores, with the potential to retain up to Rs 600 crore in oversubscription.

The issue will open on September 21 and will close on October 6, with an option to close on an earlier date or extended date, as may be decided by the Board of Directors or the NCD committee.

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“The Secured NCDs proposed to be issued under this Issue have been rated [ICRA] AA+ (Stable) by ICRA. This rating indicates a high degree of safety regarding timely servicing of financial obligations," Muthoot Finance said in a release.

As per reports, NCDs are proposed to be listed on BSE, while the allotment will be on a first come first serve basis.

“Our 32nd NCD issue is open for subscription, and the interest rate offered on NCDs has been increased by 0.50%. Compared to other available investment avenues, our NCDs, rated ‘AA+/Stable’, offer an attractive investment option. This provides our investors a dual advantage of a higher rating and attractive interest rate ranging 8.75% to 9% p.a," said George Alexander Muthoot, Managing Director, Muthoot Finance Ltd. 

Within this offering, our retail individual investors will be entitled to an additional 1% per annum above the interest rate applicable to institutions and corporates. 

The company further said that a total of seven investment options are available for Secured NCDs, offering either monthly or annual interest payments, or redemption with interest upon maturity. These options present interest rates spanning from 8.75% p.a. to 9.00% p.a. for both Individual and Corporate Investors.

The company proposes to utilize the funds raised through this issue primarily for its lending activities.

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A K Capital Services Limited is the lead manager to the Issue, while IDBI Trusteeship Services Limited is the Debenture Trustee for the Issue. Link Intime India Private Limited is the Registrar to the Issue.