Manappuram Fin to raise Rs 100 cr via NCDs

To expand its gold loans business, Manappuram Finance will raise Rs 100 crore through issue of secured non-convertible debentures (NCD).

The effective yield (interest) on the NCD will range from 11-12.61 per cent a year depending on the maturity.

NCDs are instruments issued by companies to raise money through a public issue. They cannot be converted into shares and hence investors in such issues get relatively higher returns. Each NCD will have a face value of Rs 1,000. The non-banking finance company also has the option to raise an additional Rs 100 crore, if it sees enough demand for the issue.

The tenure of the NCD will range from 400 days to 70 months. The issue will open on December 30, 2013, and close on January 20, 2014. The debentures will be listed on the BSE.

I. Unnikrishnan, Executive Director and CEO, Manappuram Finance, said: “The issue is designed primarily for the retail investor. The proceeds will be used for capital expenditure and working capital needs.”

Manappuram has launched this issue after a gap of two years, the last being in 2011. “The amount raised from the previous issue has been fully paid-off,” Unnikrishnan said.

The NCD issue, the gold loan NBFC said, is a step towards diversifying its source of funding.

The current batch of NCDs will be allotted in dematerialised (de-mat) format and also in physical format. Non-resident investors will, however, have to apply only through the de-mat format. ICICI Securities is the lead manager for this issue.

satyanarayan.iyer@thehindu.co.in

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