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ECL Finance Ltd, the non-banking financial services company of Edelweiss Financial Services, plans to raise ₹400 crore through a public issue of secured redeemable non-convertible debentures (NCDs), with the option of raising another ₹400 crore (a greenshoe option) in case of over subscription.
The NCDs will bear a face value of ₹1,000 each. The funds raised will be used for lending as well as for repayment of interest and the principal of existing loans.
The NCD offers an interest rate of 10.15 per cent a year with a monthly interest option, or an interest rate of 10.60 per cent a year with an annual interest option over the instrument’s 60-month tenure. Under the cumulative option, investors will get 1.655 times of the invested amount at maturity at the end of 60 months. There is also a 36-month tenure option for which the effective yield works at 10.47 per cent a year, with the annual and cumulative option offering 10.45 per cent a year.
‘Stable’ ratingThe issue has been rated ‘AA’ by CARE and ‘AA (Outlook: Stable)’ by ICRA rating agencies.
ECL Finance focuses on lending to the SME sector. Its products include corporate finance, loans against property and securities, and public issue financing, among others. It had two public issues of NCDs in 2014.
The issue opens on February 26 and closes on March 16. The NCDs will be listed on the BSE and the NSE.
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