Indian companies raise Rs 1,400 cr via NCDs in Apr-Jun quarter

Indian companies mopped up over Rs 1,400 crore via retail issuance of non-convertible debentures in the first quarter the current fiscal, primarily to meet the working capital requirements.

A cumulative amount of Rs 42,383 crore had been garnered through 35 issues of NCDs in the entire 2013-14 fiscal.

NCDs are loan-linked bonds that can't be converted into stock, and usually offer higher interest rates than convertible debentures.

Most of the funds were raised to support the working capital requirements and for other general corporate purposes.

Shriram City Union Finance, Kosamattam Finance Ltd, SREI Infrastructure Finance Ltd, ECL Finance Ltd, Midland Microfin Ltd and Muthoot Finance Ltd collectively raised Rs 1,409 crore via NCDs during the April-June quarter of 2014-15 through six issuances, according to data with the Securities and Exchange Board of India (Sebi).

This was more than the Rs 725 crore initially targeted.

Individually, Muthoot Finance mopped-up Rs 484 crore against a target of Rs 250 crore and ECL Finance garnered Rs 447 crore against the base size of Rs 200 crore.

Besides, Shriram City raked in Rs 200 crore against a target of Rs 100 crore, SREI Infra and Kosamattam Finance mopped up Rs 150 crore and Rs 100 crore, respectively against a target of Rs 75 crore each. Midland Microfin raised about Rs 27 crore against the base size of Rs 25 crore.

During April-June period of 2013-14, only one firm - SREI Infrastructure Finance - had raised Rs 134 crore via NCDs as against the target of Rs 75 crore.