Indiabulls Financial raises 1,280 cr through successful QIP

‘ 550 crore via 5 year zero coupon NCDs’
‘100 crore via 18 month zero coupon NCDs’
‘630 crore via 2.75 crore warrants at Exercise Price of Rs 225 per warrant’

Indiabulls Financial Services Ltd., one of India’s leading Non-Banking Financial Companies (NBFCs), raised ' 1,280 Crores through a Qualified Institutional Placement (QIP) of Non-Convertible Debentures (NCDs) and warrants. The warrants will entitle the holder to buy shares at a fixed price on a future date and can be traded separately from the secured NCDs.

The issue size of the NCDs was ' 650 Crores, which was divided into two series: ' 550 Crores at 10% of 5 years tenure and ' 100 Crores at 8.90% of 18 months tenure. The coupons are payable annually. As with the past issues, this issue too was very well received and saw the top investors investing in it. Leading banks and financial firms like Axis Bank, ICICI Bank, IDBI Bank, Central Bank, IOB, BOM, IDFC, SICOM, UTI MF, Reliance MF etc invested in the NCDs.

Indiabulls Financial Services Ltd. also allotted 2.75 Crore warrants at an issue price of ' 5. The warrants are convertible into equity shares at a premium of ' 225 per share, bringing the warrant issue size to about ' 632.5 Crores. Both the NCDs and the warrants will be listed separately. The warrant issue also received a healthy response and the list of investors included names like ICICI Bank, Axis Bank, UTI MF & Reliance MF & others.

Indiabulls Financial Services Ltd. is one of the fastest growing NBFCs in India, with assets under management (AUM), as of June 2010, of around ' 12,535 Crores, and a cumulative disbursal of over ' 40,000 Crores. The company’s business strategy is focussed on mortgage loans which today constitutes over 70% of the book. Amongst its financial services and banking peers, Indiabulls Financial Services Ltd. ranks amongst the top few companies both in terms of net worth, at ' 4,559 Crores, and capital adequacy, which stands at 28.48% as of June 2010. The company’s strength has been acknowledged and underlined by rating agencies that have consistently accorded high ratings to it. Indiabulls Financial Services Ltd is rated ‘LAA’ by ICRA (an associate of Moody’s Investors Service).

The present NCDs and warrants, follows in the path of prior successful issues totalling ' 1,510 Crores in the months of July and August of 2010. The July issue of ' 1,260 Crore, 3 year - zero coupon NCDs saw 19 investors investing in the issue. This was followed by another 3 year - zero coupon NCD issue of ' 250 Crores which was fully subscribed by SBI. Both the issues were 3 year – zero coupon issues priced at 9% payable semi-annually.