IIFL Finance to raise up to ₹1,000 crore via bonds

The bonds offer up to 8.75% yield, it said in a statement.

The Fairfax -backed company will issue secured redeemable non-convertible debentures (NCDs), aggregating to ₹100 crore, with a green-shoe option to retain over-subscription up to ₹900 crore, thus aggregating to a total of ₹1,000 crore.

“The bonds offer highest effective yield of 8.75% per annum for tenor of 60 months. The company will also offer an incentive of 0.25% per annum for existing bond or equity shareholders of the company. The NCD is available in tenors of 24 months, 36 months and 60 months. The frequency of interest payment is available on monthly, annual and at maturity basis for 60 months tenor, while for other tenors it is available on annually and at maturity basis,” it said.

The instrument has been rated AA/stable by Crisil and AA+/negative by Brickwork.

Rajesh Rajak, chief financial officer, IIFL Finance said that the funds raised will be used to meet credit need of more such customers and accelerate its digital process transformation to enable a frictionless experience.

“IIFL has an impeccable track record of more than 25 years and all the bond issues and the debt obligations have always been paid on time,” said Rajak.

IIFL Finance’s loan assets under management was at ₹43,160 crore as on 30 June and 93% of the book is retail, focused on small-ticket loans.

The lead managers to the issue are Edelweiss Financial Services Limited, IIFL Securities Limited and Equirus Capital Private Limited. The NCDs will be listed on the BSE Limited and National Stock Exchange of India Limited (NSE), to provide liquidity to investors. The bonds would be issued at face value of ₹1,000 and the minimum application size is ₹10,000 across all categories. The public issue opens on 27 September and closes on 18 October, with an option of early closure.