Shriram Transport to raise up to Rs 10,000 cr via public issuance of bonds

Shriram Transport Finance Company (STFC) Monday said it plans to raise up to Rs 10,000 crore through public issuance of bonds.

The company would come out with the first tranche of secured redeemable non-convertible debentures (NCDs) of face value of Rs 1,000 each having a base size of Rs 300 crore.

There would be an option to retain over-subscription aggregating up to Rs 10,000 crore, STFC said in a release.

The issue will open for subscription on July 17, 2019 and close on August 16, 2019, with an option of early closure or extension.

"The funds raised through the tranche 1 issue will be used for onward lending, financing, and for repayment/prepayment of interest and principal of existing borrowings of the company and for general corporate purposes," STFC said.

The bonds, bearing a fixed interest rate in the range of 9.12-9.70 per cent per annum will be available under 10 different series.

Senior citizens under certain category of investment will be entitled for additional incentive of 0.25 per cent per annum across all series, the company said.

STFC caters to first time buyers and small road transport operators with a primary focus on financing pre-owned commercial vehicles.

The proposed NCDs have been rated CARE AA+ Stable by CARE Ratings, CRISIL AA+/Stable by CRISIL and IND AA+: Outlook Stable by India Ratings.

These ratings indicate high degree of safety regarding timely servicing of financial obligations and carrying very low credit risk, the company further said.

STFC said it will list the bonds on NSE and BSE.

Stock of the company closed at Rs 1,059.90 on BSE, up 1.32 per cent from the previous close.