Muthoot Finance Limited has announced its 29th tranche of public issue of Secured Redeemable Non-Convertible Debentures (NCDs). The face value of each NCD is 1,000.
The issue will open on November 28 and close on December 19. However, there will be an option to close the issue on a date or an extended date to be decided by the Board of Directors or the NCD Committee.
Muthoot Finance said the issue size is commensurate with the base size 75 crore with an option to retain the oversubscription 225 crores in total up to the installment limit of Rs. 300 crores (pts).
The secured NCDs proposed to be issued under this issue are rated [ICRA] AA+ (Stable) by credit rating agency ICRA. “The rating of secured NCDs by ICRA indicates ‘high degree of safety with respect to timely servicing of financial obligations’,” Muthoot Finance said.
The issue offers a rate of return of 7.75% to 8.25% to retail and high net worth individual (HNI) investors. The interest rate on the upcoming issue has been increased by 0.25%-0.35% as compared to the previous issue.
George Alexander Muthoot, Managing Director, Muthoot Finance said, “We plan to utilize these funds in our primary lending activities. With the backdrop of increase in interest rates by RBI, we have raised the interest rates on NCDs in this issue by 0.25%-0.35% p.a. for tenors of 2, 3 and 5 years. We value the safety of our investors and assure them with our AA+/Stable rating along with attractive rate of returns of 7.75% to 8.25% per annum.
The NCDs are proposed to be listed on BSE and allotment will be on first come first serve basis.
There are seven investment options for secured NCDs with monthly or annual interest payment frequency or ‘redemption on maturity’ payouts. 90% of the issue has been allotted to retail and HNI investors, who will get a return of 0.50% over and above the interest rate applicable to institutions and corporates.