JM Financial Credit Solutions to raise Rs 750 cr via NCDs

Non-banking financial company, J M Financial Credit Solutions said it will raise up to Rs 750 crore by issuing bond next week.

The non-banking financial services (NBFC) arm of JM Financial group said issue of its non-convertible debentures (NCDs) will open on May 28 with a base issue size of Rs 300 crore with an option to retain oversubscription up to Rs 450 crore aggregating up to Rs 750 crore (tranche I issue) within the shelf limit of Rs 2,000 crore.

The issue is scheduled to close on June 20, 2018 with an option of early closure or extension as decided by the Board of Directors of the company or the NCD Public Issue Committee, it said.

"Our total revenue increased at a CAGR of 109.9 per cent from fiscal 2015 to fiscal 2018 and our profit after tax increased at a CAGR of 88.8 per cent from fiscal 2015 to fiscal 2018.

"Our NCD issue is a significant step to optimise funding costs and maintain a diverse funding portfolio that will enable us to achieve funding stability and liquidity in a fast growing market full of opportunities," said Shashwat Belapurkar, CEO, JM Financial Credit Solutions.

Available in six options, the bond will carry tenor ranging from 38 months to 120 months, offering coupon rate between 9.11-9.75 per cent.

At least 75 per cent of the net proceeds of the public 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 per cent will be used for general corporate purposes, the company said.

Additionally, the company plans to borrow Rs 3,000 crore from banks and debt market instruments in the current financial year.

The company had last year borrowed Rs 3,000 crore from banks as well as debt market.

In 2017-18, the company's loan book stood at Rs 6,000 crore and in this financial year it is looking at a CAGR growth of 20-25 per cent in disbursement, Belapurkar said.