KOCHI:
Manappuram Finance Limited (the “Company”) is one of the major NBFC players in the gold finance business in India. (Source: CRISIL Report). They provide loans against the pledge of household and/or used gold jewellery and provide short-term personal and business gold loans (“Gold Loans”) primarily to retail customers.
The Tranche 1 Issue of secured, redeemable, non-convertible debentures of face value of Rs. 1,000 each (“NCDs”) for an amount aggregating up to Rs. 10,000 million (“Shelf Limit”) opened on October 24, 2018. The base issue size of the tranche 1 issue is Rs. 2,000 million with an option to retain oversubscription up to Rs. 8,000 million aggregating up to the shelf limit (“Tranche 1 Issue / Tranche 1 Issue Size”).
The Tranche 1 Issue is scheduled to close on November 22, 2018 with an option of early closure or extension as decided by the Board of Directors of the Company (“Board”) or the Debenture Committee of the Company as the case may be.
Ratings by CARE Ratings & Brickwork Ratings India: Outlook: Stable
The NCDs proposed to be issued pursuant to the Tranche 1 Issue have been rated “CARE AA/Stable” by CARE Ratings Limited (“CARE”) for an amount of up to Rs. 10,000 million by way of its letter bearing reference number CARE/CRO/RL/2018-19/1239 and dated August 20, 2018 and revalidated by way of its letter dated September 17, 2018 and further revalidated by way of its letter dated October 8, 2018 and have been rated “BWR AA+/Stable” by Brickwork Ratings India Private Limited (“Brickwork”) for an amount up to Rs. 10,000 million by way of its letter bearing reference number BWR/NCD/HO/ERC/VS/0351/2018-19 and dated August 29, 2018 and revalidated by way of its letter bearing reference number BWR/NCD/HO/ERC/VS/0458/2018-19 and dated October 11, 2018. The rating of the NCDs by CARE and Brickwork indicates high degree of safety regarding timely servicing of financial obligations.
The ratings provided by CARE and Brickwork may be suspended, withdrawn or revised at any time by the assigning rating agency and should be evaluated independently of any other rating. These ratings are not a recommendation to buy, sell or hold securities and investors should take their own decisions. Please see Annexure A and Annexure B of the Tranche 1 Prospectus for rating letters and rationale for the aforementioned ratings.
The minimum application amount is Rs.10,000 collectively across all Series on NCDs and in multiples of One (1) NCD of face value of Rs. 1000 each after the minimum application. ^ Allotment is on a first-come-first-serve basis (except on the date of oversubscription, if any, when all the investors applying on the said date will get allotment on a proportionate basis).
Issue Structure:
Series I: Fixed Interest, Frequency: Cumulative, Tenor: 400 days, 9.70%, Redemption
Amount: Rs. 1106.83.
Series II: Fixed Interest; Frequency: Monthly, Tenor: 36 months, Coupon Rate: 9.60%,
Effective yield: 10.02%.
Series III: Fixed Interest, Frequency: Monthly, Tenor: 60 months, Coupon Rate: 10.00%,
Effective yield: 10.46%.
Series IV: Fixed Interest, Frequency: Annual, Tenor: 24 months, Coupon Rate: 9.85%,
Effective yield: 9.85%.
Series V: Fixed Interest, Frequency: Annual, Tenor: 36 months, Coupon Rate: 10.00%,
Effective yield: 9.99%.
Series VI: Fixed Interest, Frequency: Annual, Tenor: 60 months, Coupon Rate: 10.40%,
Effective yield: 10.39%.
Series VII: Fixed Interest, Frequency: Cumulative, Tenor: 24 months, Redemption Amount:
Rs. 1206.81.
Series VIII: Fixed Interest, Frequency: Cumulative, Tenor: 36 months, Redemption
Amount: Rs. 1331.52.
Series IX: Fixed Interest, Frequency: Cumulative, Tenor: 60 months, Redemption Amount:
Rs. 1640.82.
Series X: Fixed Interest, Frequency: Cumulative, Tenor: 2557 days, Redemption Amount:
Rs. 2000.00.
[Category IV] Investors (Retail Individual Investors) are defined as Resident Indian individuals and Hindu Undivided Families through the Karta applying for an amount aggregating up to and including Rs.10,00,000 across all Series of NCDs in the Tranche 1 Issue.
At least 75% of the net proceeds of the Tranche 1 Issue of NCDs will be used for the purpose of onward lending, financing, and for repayment /prepayment of interest and principal of existing borrowings of the Company. A maximum of up to 25% will be used for general corporate purposes.
The NCDs offered through the Shelf Prospectus and the Tranche 1 Prospectus both dated October 16, 2018 are proposed to be listed on BSE Limited (“BSE”). The Lead Managers to the Tranche 1 Issue are A. K. Capital Services Limited and Edelweiss Financial Services Limited.
