Shriram Transport Finance Company Limited (STFC), one of the largest asset financing NBFCs in India, plans to enter the debt capital market on 27 July, 2009 with a public issue of Non Convertible Debentures (NCDs) aggregating up to Rs 500 crores with an option to retain over-subscription of upto Rs. 500 crores for issuance of additional NCDs.

The company has filed a prospectus with the Registrar of Companies to this effect.

The NCD issue, with yield on Redemption of upto 11.50% (per annum), closes on August 14, 2009 with an option to close earlier or on such dates as may be decided, by the board of directors of the Company, subject to necessary approvals.

This Issue has been rated ?CARE AA+? by CARE and ?AA (ind)? by Fitch. The rating of CARE indicates stability and timely servicing of debt obligations and very low credit risk and the rating of Fitch indicates high safety, respectively. These ratings are not a recommendation to buy, sell or hold securities and investors should take their own decisions.

Speaking on the occasion, Mr R Sridhar, Managing Director of STFC, said: ?Over the decades, STFC has achieved success in reaching its objective of offering the common man with a host of products and services. The current NCD issue will help us enhance our lending capacity and further our objective?.

STFC intends to use the funds raised through the issuance of NCDs for various financing activities including lending and investments, subject to the restrictions contained in the Foreign Exchange Management (Borrowing and Lending in Rupee) Regulations, 2000, and other applicable statutory and/or regulatory requirements, to repay its existing loans and its business operations including for its capital expenditure and working capital requirements.

ENAM Securities Private Limited, A K Capital Services Limited, ICICI Securities Limited and Kotak Mahindra Capital Company Limited have been appointed as the Lead Managers to the Issue, while Integrated Enterprises (India) Limited will be acting as the Registrar to the Issue.

STFC is a part of the Shriram conglomerate which has significant presence in financial services viz., commercial vehicle financing business, consumer finance, life and general insurance, stock broking, chit funds and distribution of financial products such as life and general insurance products and units of mutual funds. Apart from these financial services, the group is also present in non-financial services business such as property development, engineering projects and information technology.