Money & Banking

DMI Finance raises Rs 100 cr through NCDs

PTI Mumbai | Updated on April 21, 2013

DMI Finance, a non-banking finance company backed by the Burman family of Dabur India, has raised Rs 100 crore through issue of non-convertible debentures and is looking to raise further funds over the next year to finance its growth plans, a top official has said.

The entire issue of Rs 100 crore was subscribed by the Foreign Institutional Investors (FIIs) and the NCDs have been listed on the BSE, the company said in a statement.

The NCDs have a 36-month maturity period and were offered at an interest rate of 13.5 per cent, payable on a half-yearly basis, DMI Finance said, adding that the capital raised by it will be used to expand its lending business.

“Indian fixed income is attractive to foreign investors because of the high local-currency yields that compare favourably with the very low yields in the developed economies,” DMI Finance’s Co-Founder and Managing Director Shivashish Chatterjee said.

“The recent liberalisation of the policies governing FII debt limits also allows foreign investors easier access to these investments. We are very pleased with the level and quality of interest in our debenture issue,” he added.

The company has also received “reasonable commitments” for its future capital raising and is primarily targeting foreign institutions for the same, Chatterjee told PTI.

He, however, declined to give any more details about its capital raising plans. The capital raising through NCDs comes three months after the Burman family, promoters of FMCG major Dabur India, announced they are picking up a stake in the company.

The capital to be raised is different from what the company has already raised from the Burmans, Chatterjee said, adding that the Burman family is a “minority shareholder having a seat on the board“.

Chatterjee and his colleague from Citibank, Yuvraj C Singh, started DMI Finance in 2009 as a non banking finance company, primarily aimed at addressing the short and medium term needs of corporates.

He said its assets book has grown to Rs 600 crore as of March, 2013 and has grown in the range of 30-50 per cent every year. This fiscal too, it is hoping to grow faster than the industry, said Chatterjee, declining to give a number.

A majority of the loans are for a term of 2-4 years and lending to real estate sector forms a major chunk of the assets, while there has been some lending to manufacturing and hospitality sectors as well. Additionally, it also lends to HNIs on the retail end and has recently acquired a housing finance licence.

Published on April 21, 2013

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