Kosamattam plans Rs 200 cr NCD issue; seeks Sebi nod

The Kerala-based NBFC is into gold loan financing

Kerala-based NBFC firm Kosamattam Finance Ltd plans to raise up to Rs 200 crore through a public issue of non-convertible debentures (NCDs).

The firm, which is into gold loan financing, has filed initial documents with the Securities and Exchange Board of India (Sebi) for the approval of the public issue.

NCDs are loan-linked securities issued by a company and can't be converted into stocks. They usually carry a higher interest rate than a convertible debenture.

As per the draft prospectus filed with Sebi, the firm would issue "secured, redeemable, non-convertible debentures and unsecured redeemable non convertible debentures of face value of Rs 1,000 each aggregating upto Rs 10,000 lakhs...With an option to retain over-subscription upto Rs 10,000 lakhs aggregating upto Rs 20,000 lakhs".

Kosamattam plans to use the proceeds from the issue for the purpose of "onward lending and for repayment of interest and principal of existing loans" as well as general corporate purposes".

"Our company is in the business of gold loan financing, and as part of our business operations, we raise/avail funds for onward lending and for repayment of interest and principal of existing loans," Kosamattam said.

Vivro Financial Services is the lead manager to the issue, while IL&FS Trust Company is the debenture trustee.

Karvy Computershare would act as the registrar to the issue, the offer documents showed.

According to the firm, the NCDs offered "are proposed to be listed on the BSE".

"Our company has obtained 'in-principle' approval for the issue from BSE...BSE shall be the Designated Stock Exchange for this issue," it added.

Kosamattam, part of Mathew K Cherian-led Kosamattam Group, is into the business of lending money against the pledge of household jewellery in the state of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Delhi, Maharashtra, Gujarat, Telangana and in the Union Territory of Puducherry.

As on December 31, 2014, the firm had a network of 875 branches spread in the states including Kerala, Tamil Nadu, Karnataka, Andhra Pradesh and Delhi.

For eight months ended November 30, 2014 the company's total income stood at Rs 156 crore.