IIFL Finance to raise up to 1,000 crore via bonds

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Mumbai: IIFL Finance, a non-bank finance company (NBFC), announced Thursday that it will open a public covered bond issue on September 27 to raise up to ??1,000 crore, for business growth and capital increase.

The bonds offer up to 8.75% yield, he said in a statement.

The Fairfax-backed company will issue guaranteed non-convertible redeemable debentures (NCDs), totaling ??100 crore, with a green shoe option to keep the oversubscription up to ??900 crore, for a total of ??1,000 crores.

“Bonds offer the highest effective yield of 8.75% per year for a term of 60 months. The company will also offer an incentive of 0.25% per annum to existing shareholders of bonds or shares of the company. The NCD is available in terms of 24 months, 36 months and 60 months. The interest payment frequency is available on a monthly, annual and maturity basis for a term of 60 months, while for other terms it is available on an annual basis and at maturity, ”he said.

The instrument was rated AA / stable by Crisil and AA + / negative by Brickwork.

Rajesh Rajak, chief financial officer of IIFL Finance, said the funds raised will be used to meet the credit needs of more of these clients and accelerate the transformation of its digital processes to enable a frictionless experience.

“The IIFR has an impeccable track record of over 25 years and all bond issues and debt securities have always been paid on time,” Rajak said.

The loan assets under management of IIFL Finance amounted to ??43,160 crore as of June 30 and 93% of the book is retailed, focused on low cost loans.

The main managers of the issue are Edelweiss Financial Services Limited, IIFL Securities Limited and Equirus Capital Private Limited. The NCDs will be listed on the BSE Limited and the National Stock Exchange of India Limited (NSE), in order to provide liquidity to investors. The bonds would be issued at the par value of ??1000 and the minimum application size is ??10,000 in all categories. The public offering opens on September 27 and closes on October 18, with an early closing option.

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