Edelweiss Housing Finance, the housing finance business of the Edelweiss group, has decided to raise up to Rs 500 crore through a public issue of non-convertible debentures (NCDs) with a face value of Rs 1,000 each.
The size of the issue is Rs 250 crore with a green shoe option of retaining over-subscription up to a further Rs 250 crore, the company said in a statement on Monday.
Investors will be given a chance to lock a 9.57% per annum interest rate on the instruments with a monthly interest option or a 10.00% per annum interest rate with an annual interest option. The NCDs have been rated ‘AA’ by Credit Analysis and Research and by ICRA.
The issue will open on July 8 and will close on July 27. The company said that the instruments will be listed on both the BSE and the National Stock Exchange.
“The NCD will help raise capital for portfolio growth and geographic expansion of branches from 45 to 78 over next 18 months,” Anil Kothuri, chief executive officer at Edelweiss Housing Finance, said.
Speaking about the housing finance company’s expansion plans for the time to come, Kothuri pointed out that the company has managed to clock a compounded annual growth rate of 49.5% over the last four years. He also said that factors like the government’s push for affordable housing and falling interest rates are expected to fuel growth in the housing finance sector going ahead.
“Mid-size HFCs given their focus on affordable housing projects and their relatively higher concentration in tier-II and smaller cities are going to lead this growth. We see significant opportunity for EHFL given our product suite, focus on affordable housing, wide geographic presence,” the CEO said.
SBI Capital Markets and Edelweiss Financial Services will be the book-running lead managers for the issue.