Kerala-based Manappuram Finance Ltd, a leading gold loan NBFC, today launched a public issue of secured, redeemable, Non Convertible Debentures (NCD) with an issue size of Rs 100 crore.
The issue will also have a green shoe option of an equal amount, V P Nandakumar, Managing Director and CEO Manappuram Finance Ltd, told reporters here.
Green shoe option is a provision contained in an underwriting agreement that gives the underwriter the right to sell investors more shares than originally planned by the issuer.
The tenure of the debentures, which will have a face value of Rs 1,000 each, would range from 400 days to 70 months, he said, adding, the issue would be utilised in augmenting the capital expenditure and meeting the working capital requirements.
If this issue was successful, the company could come out with more NCDs in the coming months as it has already got a long-term credit rating of A+/Negative from CRISIL for the current issue for an amount of upto Rs 300 crore.
The NCDs will have effective yield of 12.61 per cent per annum.
There is huge scope for expanion in gold loans as not even one-10th of the total family gold in the country, has been monitised, he said. It is estimated that there is 25,000 tonnes of family gold in the country. Manappuram has over 50 tonnes og gold in its lockers, he said.
I Unnikrishnan, Executive Director and Deputy CEO, Manappuram Finance Ltd said the issue, which opened today, will close on January 20.
This is the second public issue of Mannappuram, which had launched a public issue two years ago.
MFL reported a net profit after tax of Rs 208.432 crore for 2013 fiscal and a net worth of Rs 2443 crore as on March 31 this year and a capital adequacy of 22.67 per cent as of March 31, 2013.