26-Oct-2023
2 mins read
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Muthoot Fincorp Limited (MFL) NCD
NCD Detail
Muthoot Fincorp Limited, a non-deposit-taking NBFC, is gearing up to launch a debt offer from April 12 to April 26, 2023. The company plans to raise Rs 150 crores at a price of Rs 1000 per NCD, with a minimum application of 10 NCDs. CRISIL Ratings Limited has assigned the issue a rating of CRISIL AA-/Stable.
Apart from providing personal and business loans secured by gold ornaments and jewellery, the company offers foreign exchange conversion and money transfer services and generates and sells wind energy through its wind farms in Tamil Nadu. Additionally, the company is involved in a real estate business in collaboration with joint venture developers of company-owned land parcels.
As of December 31, 2022, Muthoot Fincorp Limited operates 3,627 branches across 24 states, including the union territory of Andaman and Nicobar Islands and the national capital territory of Delhi. It employs 15,079 employees, including 168 contracted experts in its operations. As of December 31, 2022, the company’s gold loan portfolio consisted of approximately 32.89 lakh loan accounts. Muthoot Fincorp offers several gold loan products such as the Muthoot Blue Guide Gold loan, Muthoot Blue Bright Gold loan, Muthoot Blue Power Gold loan, Muthoot Blue Bigg Gold loan, Muthoot Blue Smart Gold loan, and 24×7 Express Gold loan.
About Company
Muthoot Fincorp Ltd. (MFL) is a Kerala-based company with over two decades of gold loan experience. It primarily offers retail loan products, mainly gold loans. The gold loan product range includes:
- The Muthoot Blue Guide Gold loan.
- Muthoot Blue Bright Gold loan.
- Muthoot Blue Power Gold loan.
- Muthoot Blue Bigg Gold loan.
- Muthoot Blue Smart Gold loan.
- 24×7 Express Gold loan.
MFL’s “24×7 Express Gold loan” is a top-up loan that existing customers can avail of against their gold jewellery. The “Smart Plus Gold loan” variant is tailored to salaried customers, with a tenure of up to 24 months.
As of December 31, 2022, MFL’s gold loan portfolio comprised 32.89 lakh loan accounts. It operates out of 3,627 branches in 24 states, including the national capital territory of Delhi and the union territory of the Andaman and Nicobar Islands. It has a workforce of 15,079 employees, including 168 contracted experts.
Issue Details
MFL is set to launch its Secured Redeemable Non-Convertible Debentures with a face value of Rs 1000 each for a base amount of Rs 150 crore. The company has a green shoe option to retain oversubscription of up to Rs 150 crore, making the total issue size Rs 300 crore. The subscription for this issue will begin on April 12, 2023, and end on April 26, 2023. The minimum application for the NCDs is 10 units, with each unit costing Rs 1000. The NCDs will be listed on the BSE post-allotment.
MFL will spend approximately Rs 3.84 crore from the proceeds of the issue, amounting to Rs 300 crore. However, the exact amount of expenses is subject to change depending on the subscription level, market conditions, and other factors. At least 75% of the net proceeds will be utilised for onward lending, financing, and repayment/prepayment of existing borrowings with interest. Up to 25% will be used for general corporate purposes.
This is MFL’s 15th debt offer since July 2014, with the previous offer made in January 2023. The company has increased the coupon rates in line with current interest rates. The offer has tenures of 27 months, 42 months, 60 months, and 84 months, with coupon rates ranging from 8.40% to 9.15%, depending on the options applied. Interest payments can be made either monthly, annually, or cumulatively, based on the series selected.
The issue is managed by SMC Capitals Ltd., with Integrated Registry Management Services Pvt. Ltd. acting as the registrar of the issue and Vardhman Trusteeship Pvt. Ltd. as the Debenture Trustee.
Financial Performance (In Crore)
| Fiscal Year | Total Revenue | Net Profit |
| FY20 | Rs 3765.99 Crore | Rs 257.93 Crore |
| FY21 | Rs 4101.19 Crore | Rs 397.28 Crore |
| FY22 | Rs 4355.13 Crore | Rs 412.55 Crore |
Standalone Basis for 3Qs of FY23
| Particulars | Amount |
| Net Profit | Rs 317.91 Crore |
| Total Income | Rs 2541.56 Crore |
| Net NPAs as of Dec 31, 22 | 2.23% |
Others
| Particulars | Amount |
| Gold loan AUM as of Dec 31, 22 | Rs 17852 Crore |
| Post-Issue Debt-Equity Ratio | 4.83 |
Important Dates
| Issue Open | Apr 12, 2023 – Apr 26, 2023 |
| Security Name | Muthoot Fincorp Limited |
| Security Type | Secured, Redeemable, Non-Convertible Debentures (Secured NCDs) |
| Issue Size (Base) | Rs 150.00 Crores |
| Issue Size (Shelf) | Rs 300.00 Crores |
| Issue Price | Rs 1000 per NCD |
| Face Value | Rs 1000 each NCD |
| Minimum Lot Size | 10 NCD |
| Market Lot | 1 NCD |
| Listing At | BSE |
| Credit Rating | CRISIL AA-/Stable by CRISIL Ratings Limited |
| Tenor | 27, 42, 60, and 84 Months |
| Series | Series I to VIII |
| Payment Frequency | Monthly, Annual and Cumulative |
| Basis of Allotment | First Come First Serve Basis |
| Debenture Trustees | VARDHMAN TRUSTEESHIP PRIVATE LIMITED |
Tenure-wise Coupon Rate
| Tenure | Interest Type | Coupon (% per Annum) | Effective Yield (% per Annum) | Amount on Maturity |
| 27 Months | Non-cumulative | 8.40% | 8.71% | Rs 1,000.00 |
| 42 Months | Non-cumulative | 8.65% | 9.00% | Rs 1,000.00 |
| 60 Months | Non-cumulative | 8.80% | 9.15% | Rs 1,000.00 |
| 84 Months | Non-cumulative | 9.00% | 9.37% | Rs 1,000.00 |
| 60 Months | Cumulative | 9.15% | 9.15% | Rs 1,000.00 |
| 27 Months | Cumulative | N/A | 8.71% | Rs 1,207.00 |
| 42 Months | Cumulative | N/A | 9.00% | Rs 1,353.00 |
| 84 Months | Cumulative | N/A | 9.37% | Rs 1,873.00 |
NCD Rating
CRISIL has rated this offer as CRISIL/AA- Stable, indicating that the NCDs have low credit risk and sufficient safety concerning timely financial obligations. However, it should be noted that the rating may be revised, withdrawn or suspended at any time by the assigning rating agency. It is recommended that investors make independent evaluations of the ratings provided and should not base their investment decisions solely on these ratings.
Company Promoters
The company promoters are Thomas John Muthoot, Thomas George Muthoot, and Thomas Muthoot.
The Objective of the Issue
The company will utilise the funds raised through the Issue for two main objectives. Firstly, 75% of the amount raised and allotted in the Issue will be allocated towards the purpose of Working Capital. Secondly, the remaining 25% of the amount raised and allotted in the Issue will be utilised for General Corporate Purposes. These funds will enable the company to efficiently manage its working capital needs and address its various general corporate requirements. The allocation of funds towards these objectives will ensure the company can operate effectively and sustainably.
How to Apply
Wait for the NCD to open for subscription, then click on this link to apply for the Muthoot Fincorp Limited (MFL) NCD with Bigul https://ncd.bonanzaonline.com/.
How to Check Allotment Status
The registrar for Muthoot Fincorp Limited (MFL) NCD is Integrated Registry Management Services Private Limited. To check your allotment status, please click on this link http://www.integratedindia.in/
FAQs
- When will Muthoot Fincorp NCD April 2023 public issue be available for subscription?
The Muthoot Fincorp NCD April 2023 issue will open for subscription from April 12, 2023, until April 26, 2023.
- What is the pricing of the Muthoot Fincorp Limited NCD issue?
The price of Muthoot Fincorp NCD in April 2023 is Rs 1000 per NCD.
- What is the face value of Muthoot Fincorp NCD April 2023?
The face value of each NCD is Rs 1000.
- What is the frequency of interest payment for Muthoot Fincorp NCD April 2023?
The payment frequency for Muthoot Fincorp NCD April 2023 is Monthly, Annual, and Cumulative.
- What is the minimum application size for investment in the Muthoot Fincorp NCD April 2023 public issue?
The minimum application size is 10 NCDs, with multiples of 1 NCD after that.
- What is the closing time of Muthoot Fincorp NCD April 2023?
The Muthoot Fincorp NCD April 2023 will remain open for subscription on working days from 10:00 am to 5:00 pm until April 26, 2023. The bid may close earlier in case it is fully subscribed.
- What are the tenors of Muthoot Fincorp NCD April 2023 bonds?
The NCDs have a fixed maturity date, with a tenor of 27, 42, 60, and 84 months.
- What is the base issue size of Muthoot Fincorp NCD April 2023?
The Muthoot Fincorp NCD April 2023 consists of a base issue of Rs 150.00 Crores and a shelf issue of Rs 300.00 Crores. The shelf issue is an option to retain oversubscription up to the shelf issue size over and above the base issue.
- Are NRIs eligible to apply for the Muthoot Fincorp Limited NCD IPO?
No, NRIs are not eligible to apply for this issue.
- Who is not eligible to invest in the Muthoot Fincorp Limited issue?
Minors without a guardian name, foreign nationals, persons resident outside India, foreign portfolio investors, foreign venture capital investors, qualified foreign investors, overseas corporate bodies, and persons ineligible to contract under applicable statutory/regulatory requirements are not eligible to invest.
- On which stock exchange are the Muthoot Fincorp Limited NCDs proposed to be listed?
The NCDs are proposed to be listed on the BSE.
- What is the utilisation of funds raised through the Muthoot Fincorp NCD April 2023?
75% of the amount raised and allotted in the issue will be utilised for working capital, while 25% will be used for general corporate purposes.
- What is the rating of Muthoot Fincorp NCD April 2023?
The issue is rated CRISIL/AA- Stable by CRISIL, indicating an adequate degree of safety regarding the timely servicing of financial obligations with very low credit risk.
- Can the ratings provide by CRISIL Ratings Limited change?
Yes, the ratings provided by CRISIL Ratings Limited may be suspended, withdrawn, or revised at any time by the assigning rating agency. They should be evaluated independently of any other rating. Investors should make their own decisions as these ratings are not a recommendation to buy, sell or hold securities.