Anagram Finance To Float Bank

The company will shortly approach the Reserve Bank of India (RBI) for a licence.

This move is likely to put another nail in the coffin of the proposed Bank of Gujarat venture, which had Arvind Mills as a promoter. Arvind Mills was planning to pick up a stake in Bank of Gujarat. However, with Anagram floating a bank, Arvind Mills is not likely to be interested in the Bank of Gujarat venture.

Anagram Finance will enter the debt market in the last week of October to raise Rs 60 crore through a public issue of bonds. The company is already into the private placement market.

It also plans to move into the insurance sector. Confirming the move, S Nadkar, vice-chairman and managing director of Anagram Finance, said: We are talking to some well-known foreign companies. We plan to enter the life insurance sector once it is thrown open.

Nadkar added that Anagram Wellington Asset Management will soon be launching a mutual fund. We plan to float the scheme in December, he said.

Christened Anagram Anmol Bonds, the finance company proposes to offer a 18.5 per cent yield on the three instruments that it has lined up.

Merchant banking sources disclosed that the finance company proposes to give an early bird incentive on the bond issue. However, after the Sebi directive that early bird incentives cannot be offered, sources said Anagram Finance is working on a new incentive structure.

But the yield on the instrument will be 18.5 per cent, the source confirmed.

In the deep discount bond, called Double Plus Bond, the investor can invest Rs 2,140 and get back Rs 5,000 after a five-year period. The effective yield will be 18.5 per cent.

The regular return bond, christened as Festival Bond, will also yield returns of 18.5 per cent. The instrument is likely to have a coupon rate of 17.5 -18 per cent. Anagram plans to tap the market during the Diwali festival.

The third instrument is Quarterly Bond, where investor will receive Rs 65 every quarter as interest on Rs 1,500.