Mahindra Finance ends higher after board OKs proposal to issue NCDs of up to Rs 1,250 crore

Mahindra & Mahindra Financial Services added 3.57% to end at Rs 332 after the company's board approved a proposal for issuance of non-convertible debentures of up to Rs 1,250 crore on private placement basis.

The non-convertible debentures would be secured, rated, listed and redeemable. They would be listed on the wholesale debt market segment of BSE.

The size of the issue is Rs 750 crore with a green shoe option up to Rs 500 crore.

Accordingly, the company would issue up to 1,25,000 debentures to be issued at a face value of Rs 1 lakh each.

The tenure of the instrument would be 3 years & 89 days from the deemed date of allotment, i.e., from 26 September 2024. The instrument would bear a fixed coupon of 8.01% per annum.

The debentures shall be secured by way exclusive charge in favour of the debenture trustee on present and/or future receivables under loan contracts/hire purchase/lease, owned assets and book debts to the extent of 100% of debenture outstanding.

The security shall be created on assets which are free from any encumbrances. The company will create appropriate security in favour of the debenture trustee within the time frame prescribed as per applicable law.

In case of default in payment of coupon and/or principal redemption on the due dates, additional interest at 2% per annum over the coupon will be payable by the company for the defaulting period.

Mahindra & Mahindra Financial Services (Mahindra Finance), part of the Mahindra Group, is one of India's leading non-banking finance companies. Focused on the rural and semi-urban sector, the company has over 10 million customers and has an AUM of over $11 billion. The company is a leading vehicle and tractor financier, provides loans to SMEs and also offers fixed deposits.

The NBFCs standalone net profit jumped 45% to Rs 513 crore on 20% increase in total income to Rs 3,760 crore in Q1 FY25 over in Q1 FY24.

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