JM Financial NCD issue: The base size of the issue is Rs 250 crore with an option to retain over-subscription of up to Rs 1,000 crore, aggregating to Rs 1,250 crore.
JM Financial NCD issue: JM Financial Credit Solutions Limited, the NBFC arm of the JM Financial Group, will offer tomorrow secured non-convertible debentures (NCDs) for public subscription with up to 10.25% coupon rate. The base size of the issue is Rs 250 crore with an option to retain over-subscription of up to Rs 1,000 crore, aggregating to Rs 1,250 crore. Notably, the second tranche of the issue comes at a time when the real estate market is facing a liquidity squeeze. “In Tranche 1, the company had raised Rs 7,500 million (Rs 750 crore) in the month of June 2018,” JM Financial Group said in a statement last week.
“We are overwhelmed with the response received for our first maiden issue earlier this year and are offering an additional interest incentive of 15 basis points per annum for 5 years & 10 years tenure to the eligible investors. Also, the effective yield for Tranche II secured NCDs is at least or above 10% across various Options/Series ranging from 42 months to 120 months,” said Shashwat Belapurkar, CEO, JM Financial Credit Solutions Limited.
As the company gears up to launch its secured NCDs on Tuesday, we bring to you seven key things to know about the upcoming JM Financial Credit Solutions NCD issue:
- Issue open and close date: The offer opens on November 20, 2018, Tuesday and closes for subscription on December 20, 2018, Thursday, with an option of early closure or extension as decided by the Board of Directors of the company or the NCD Public Issue Committee constituted by the Board of Directors.
- Coupon Rate on NCDs: The ROI ranges from 9.67% to 10.25% depending on the category of investor and tenure of the NCDs. The available tenor options range 42 months to 10 years.
- Issue size and mode: Debentures of face value of Rs 1,000 each (“Secured NCDs”) with a base issue size of Rs 250 crore with an option to retain oversubscription up to Rs 1,000 crore,
aggregating up to Rs 1,250 crore (Tranche II Issue), which is within the shelf limit of Rs 2,000 crore. The NCDs will be issued in only in dematerialised form.
- Minimum application amount: The minimum application amount is Rs.10,000 collectively across all options/series on NCDs and in multiples of one (1) NCD of the face value of Rs. 1000 each after the minimum application. The secured NCDs are proposed to be listed on the BSE.
- Credit ratings: The NCDs have been rated [ICRA] AA/Stable by ICRA for an amount of up to Rs 2,000 crore and IND AA/Stable by India Ratings for an amount up to Rs 2,000 crore.
- Issue allocation ratio: 40% of the issue is for retail investors and 40% for high net worth individuals. “Allotment of NCDs is on ‘first come, first serve’ basis,” the statement said.
- Issue managers: The lead managers to the issue are A. K. Capital Services Ltd., JM Financial Limited, Edelweiss Financial Services Limited and Trust Investment Advisors Private Limited.