Muthoot Finance NCD : Muthoot Finance Limited NCD Opens On Sep 27

Muthoot Finance NCD : Muthoot Finance Limited NCD Opens On Sep 27

Muthoot Finance NCD September 2019

Muthoot Finance is India’s largest gold loan company in terms of the loan portfolio and branch network. It has launched the scheme name as Muthoot Finance NCD. It is a secured NCD. The scheme will open for subscription on 27th September 2019. The high yield of these NCDs offer over 10 percent per annum, it would attract the investors. The subscription period of the scheme will close on 25th October 2019. 

Muthoot Finance NCD Sep 2019 Detail

 Issue Open  Sep 27, 2019 – Oct 25, 2019
 Security Name  Muthoot Finance Limited
 Security Type  Secured, Redeemable, Non-Convertible Debentures (Secured NCDs)
 Issue Size (Base)  Rs 100.00 Crores
 Issue Size (Shelf)  Rs 900.00 Crores
 Issue Price  Rs 1000 per NCD
 Face Value  Rs 1000 each NCD
 Minimum Lot size  10 NCD
 Market Lot  10 NCD
 Market Lot  1 NCD
 Listing At  BSE
 Credit Rating  ICRA AA/Stable, CRISIL AA/Stable
 Tenor  24 months/ 38 months/ 60 months/ 90 months
 Series  Series 1 to 10
 Payment Frequency  Monthly and Annual
 Basis of Allotment  BSE

Investors need to invest a minimum of 10 bonds. Means invest for a minimum of Rs 10,000 in multiples of 1 bond. Interest payables available monthly, yearly, and cumulative. Individual coupon rates ranged between 9.25% to 10.00%.

All categories of investors are eligible to apply for this secured NCD except for NRIs. They cannot apply to this NCD.

This secured NCD will manage by AK Capital Services Ltd and Edelweiss Financial Services. Muthoot Fincorp NCD has proposed to be listed on the Bombay stock exchange. The NCDs are liquid investments.

Objects of the Issue

The net proceeds raised through the issue will utilize for lending and general corporate purposes.

The issue is available in 10 series that come with a fixed period of 2 years, 38 months, 5 years, 90 months. It offers Rs 100 crores with an option of retaining over a subscription of Rs 900 crores. The Face value of the NCD bond is Rs 1000.

Credit Ratings:

Muthoot Finance NCDs have been rated as AA by ICRA and CRISIL AA/ Stable by CRISIL.

Muthoot Finance NCD Coupon Rates

 Series  Category  Tenor  Frequency of Interest Payment  Coupon Rate  Effective Yield  Amount on Maturity
  I  Secured  2 Years  Monthly  9.25%  9.25%  ₹1,000
  II  38 Months  Once a month  9.50%  9.50%  Rs 1,000
  III  5 Years  Every Month  9.75%  9.75%  ₹1,000
  IV  2 Years   Annually  9.50%  9.50%  Rs 1,000
  V  38 Months  Yearly  9.75%  9.75%  ₹1,000
  VI  5 Years  Annually  10.00%  10.00%  Rs 1,000
  VII  2 Years   N/A  NA  9.25%  ₹1,193.56
  VIII  38 Months  NA  N/A  9.50%  Rs 1,333.72
  IX  5 Years  NA  NA  9.75%  ₹1,592.29
  X  90 months  N/A  N/A  9.67%  Rs 2,000

NCD’s Offered

 Category  NCD’s Reserved
 Qualified Institutional Buyers (QIB)   10%
 Non-Institutional Investors (NII)  10%
 High Networth Investors (HNI)  30%
 Retail Investors (RII)  50%

The scheme attracts the investors with high yields up to 10 percent. A source analyzed that It offers secured NCDs which are safe yet this time. Moreover, It gets a good credit rating from CRISIL and ICRA Rating agency. Although, gold finance companies are riskier. Though Muthoot finance is offering secured NCDs, there could be a delay in the interest and repayment of principal at maturity.

Disclaimer: This post is just information about the scheme. It does not give any advice or recommendation. Please read the offer document carefully and consult your investment adviser before investing.

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