Leading non-bank lender IIFL Finance is raising up to Rs 1,500 crore through a public issue of secured redeemable non-convertible debentures (NCDs) to fuel credit growth and debt management, a senior company official said on Thursday.
The public issue of the IIFL NCDs will open on Friday and has a base offer of Rs 300 crore. However, the company has a green shoe option to retain an over-subscription of up to Rs 1,200 crore.
With the Reserve Bank of India pausing its rate hike cycle, IIFL remains optimistic about raising the entire Rs 1,500 crore in this tranche of issues with an attractive 9 per cent coupon rate.
"We expect to raise the full subscription amount in this issue due to the attractive coupon rates. Credit growth is robust after the Covid-19 pandemic,” IIFL Director Gaurav Mishra said.
The IIFL bonds offer a coupon rate starting at 8.35 per cent for 24 months and the highest effective yield of 9 per cent per annum for a tenor of 60 months.
IIFL has kept the highest coupon rate at 9 per cent, the same as its last NCD issue in January, in which it announced raising up to Rs 1,000 crore.
The NCDs are available in tenors of 24 months, 36 months and 60 months. The face value of the NCDs is Rs 1,000 each and the minimum application size is Rs 10,000. The NCDs will be listed on the BSE and NSE.
The credit rating has been AA by CRISIL Ratings and ICRA. In Q4 FY23, Moody's upgraded IIFL Finance's rating from B2 to B1 (stable).
IIFL Finance, through a strong physical presence of over 4,000 branches across India and a well-diversified retail portfolio, caters to the credit needs of underserved populations.
“Our current asset under management is nearly Rs 65,000 crore and the gold loan remains our largest loan book with Rs 27,000 crore, followed by home loan of Rs 21,800 crore as on March 2023,” Mishra said.
He said credit growth to micro and SMEs stood at 59 per cent in FY23 with an outstanding loan of Rs 9,780 crore.
The NBFC opened 700 branches to expand its reach in gold loans, which grew 28 per cent in FY'23 over the previous year.
IIFL Finance has a 95 per cent retail book focused on small-ticket loans.
IIFL Finance's gross NPA was 1.8 per cent and its net NPA of 1.1 per cent. As on March 31, about 73.53 per cent of the company's consolidated loan book is secured with adequate collaterals, which helps mitigate risks further, the company said.
In FY23, IIFL Finance reported a profit after tax of Rs 1,607.5 crore, a 35 per cent year-on-year growth.