Manappuram Finance to raise Rs 750 cr from bonds

Mumbai: Pure-play gold loan company Manappuram Finance on Thursday joined a growing breed of financiers opting to raise debt in a rising interest rate regime and increasing market volatility, and said it will raise Rs 750 crore through from bond issue.

The non-convertible debenture issue, opening on August 18 and closing on September 5, offers interest rate up to 12.20 percent annually on the two-year bond. The face value of each bond is Rs 1,000 with a minimum subscription of five bonds and will be listed on the Bombay Stock Exchange.

The fund raised will be used for various financing activities, including investments and lending, Manappuram Finance managing director I Unnikrishnan said. It will also be used for capital expenditure and working capital requirements, he said. The Kerala-based company, Unnikrishnan said, has enough capital to take its loan book to Rs 15,000 crore in one year and out of that Rs 2,000 crore will be raised from this bond issue.

As of June 30, the company's loan portfolio stood at Rs 9,000 crore and the capital adequacy at 29.3 percent, which is much above the Reserve Bank requirement of 15 per cent. Recently, many NBFCs, including Shriram Transport Finance, Muthoot Finance and India Infoline Financial Services among others have tapped the bond market to raise funds.

Source: Financial Express