 "Shriram Transport to raise Rs 5k cr in Q4 by securitisation of loans")
Truck financier Shriram Transport Finance Company will raise funds amounting to Rs 5,000 crore in the last quarter of financial year 2018-19 (Q4FY19) through securitisation of its loans. It has raised Rs 5,300 crore via securitisation in Q3FY19, said Umesh Revankar, chief executive officer (CEO) of Shriram Transport.
Securitisation is the process of conversion of a loan into marketable securities for raising cash by selling them to other investors.
The firm also plans to raise $750 million in foreign currency funding in FY20, which is the threshold set by the Reserve Bank of India in terms of foreign investment in any finance company. It has already raised $750 million in this fiscal year (FY19).
The company on Wednesday said it has raised $400 million via dollar bond sale after the regulator eased norms for finance companies to raise funds overseas. This was the company’s maiden dollar bond issue. It had earlier placed masala bonds.
For the dollar bond sale, Deutsche Bank, HSBC, ING and Standard Chartered Bank acted as joint global coordinators, with Barclays, Citi, Emirates NBD Capital and J.P. Morgan acting as joint lead managers.
The bond sale was earlier priced at 6 per cent. However, the company was successful in bringing down the price by 30 basis points to 5.7 per cent as it is backed by high quality real investors and a strong book, said the company.
At a time when raising money domestically has been a challenge for non-banking financial companies (NBFCs) after the beleaguered Infrastructure Leasing & Financial Services (IL&FS) group defaulted on its debt payments and created a liquidity freeze situation, NBFCs with quality books will look at overseas funding.
In Q3FY19, the company registered a net profit of Rs 635.45 crore, up 17.34 per cent from Rs 541.54 crore in Q3FY18. Total income of the company also increased 18.22 per cent to Rs 3,993.40 crore compared to Rs 3,378 crore in the December quarter of the previous fiscal year.
The company's assets under management (AUM) as on December 31, 2018, stood at Rs 103,817.94 crore as compared to Rs 90,964.22 crore a year ago.
Securitisation is the process of conversion of a loan into marketable securities for raising cash by selling them to other investors.
The firm also plans to raise $750 million in foreign currency funding in FY20, which is the threshold set by the Reserve Bank of India in terms of foreign investment in any finance company. It has already raised $750 million in this fiscal year (FY19).
The company on Wednesday said it has raised $400 million via dollar bond sale after the regulator eased norms for finance companies to raise funds overseas. This was the company’s maiden dollar bond issue. It had earlier placed masala bonds.
For the dollar bond sale, Deutsche Bank, HSBC, ING and Standard Chartered Bank acted as joint global coordinators, with Barclays, Citi, Emirates NBD Capital and J.P. Morgan acting as joint lead managers.
The bond sale was earlier priced at 6 per cent. However, the company was successful in bringing down the price by 30 basis points to 5.7 per cent as it is backed by high quality real investors and a strong book, said the company.
At a time when raising money domestically has been a challenge for non-banking financial companies (NBFCs) after the beleaguered Infrastructure Leasing & Financial Services (IL&FS) group defaulted on its debt payments and created a liquidity freeze situation, NBFCs with quality books will look at overseas funding.
In Q3FY19, the company registered a net profit of Rs 635.45 crore, up 17.34 per cent from Rs 541.54 crore in Q3FY18. Total income of the company also increased 18.22 per cent to Rs 3,993.40 crore compared to Rs 3,378 crore in the December quarter of the previous fiscal year.
The company's assets under management (AUM) as on December 31, 2018, stood at Rs 103,817.94 crore as compared to Rs 90,964.22 crore a year ago.
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