Zerodha (Trading & Demat Account)
FREE Equity Delivery and MF
Flat ₹20/trade Intra-day/F&O
Zerodha (Trading & Demat Account)
FREE Equity Delivery and MF
Flat ₹20/trade Intra-day/F&O
|
|
• This is the maiden debt offer from Aditya Birla Group's finance arm's 100% subsidiary.
• This debt offer has AAA ratings from India Rating and ICRA.
• The company offers reasonable coupon rates with such good ratings.
• The company has posted growing financial performance for the reported periods.
• Investors looking for safe and steady returns may park funds for the medium to long term.
ABOUT COMPANY:
Aditya Birla Finance Ltd. (ABFL) is an RBI registered non-deposit-taking systemically important non-banking financial company ("NBFC-ND-SI"). The Company was incorporated in 1991 and obtained a certificate of registration in 2011 to carry on the business of a non-banking financial institution without accepting public deposits under Section 45IA of the RBI Act, 1934. It has been categorized as an 'Upper Layer' NBFC under the scale-based regulatory framework for NBFCs introduced by the RBI, with effect from September 30, 2022.
ABFL offers end-to-end lending, financing, and wealth services to retail, HNI, ultra HNI, micro, small and medium enterprises ("MSME"), small and medium enterprises ("SME"), and corporate customers. As of June 30, 2023, it had total loans outstanding of Rs. 85778.5 cr. ABFL had 332 branches and 59,14,504 customers as of the said date.
The Company caters to the varied needs of a diverse set of customers ranging across retail, HNI, ultra HNI, MSMEs, SME, and corporate customers. The portfolio is well diversified across various sectors and products. It offers customized solutions in areas of personal and business loans, corporate finance, mortgages, personal loans, business loans, check-out financing, loans against property, term loans, working capital loans, loans against securities, project loans, and wealth services. The AUM of the Company stood at Rs. 85891.2 cr. as of June 30, 2023. The number of customers of the Company has grown from 212787 as of March 312021, to 5914504 as of June 30, 2023.
ISSUE DETAILS:
ABFL is coming out with its maiden debt issue of Secured, Rated, Listed, Redeemable, non-convertible debentures of the face value of Rs. 1000 each. The base size of this debt issue is Rs. 1000 cr. and the company has a green shoe option to retain oversubscription to the tune of Rs. 1000 cr. Thus the overall issue size is Rs. 2000 cr. aggregating 20000000 NCDs. The issue opens for subscription on September 27, 2023, and will close on or before October 12, 2023. The minimum application to be made is for 10 NCDS (i.e. Rs. 10000) and in multiple of 1 NCD (i.e. Rs. 1000) thereon, thereafter. Post allotment, NCDs will be listed on BSE and NSE.
The issue is jointly lead managed by Trust Investment Advisors Pvt. Ltd., A. K. Capital Services Ltd., JM Financial Ltd., and Nuvama Wealth Management Ltd. while Link Intime India Pvt. Ltd. is the registrar of the issue. Vistra ITCL (India) Ltd. is the debenture trustee.
The company has allocated 25% for QIBs, 25% for NIIs, 25% for HNIs, and 25% for Retail investors. The company may, at its sole discretion, from time to time, invite the NCD holders to offer the NCDs held by them through one or more buy-back schemes that are determined by the company from time to time.
The tenors of the NCDs will be 3 years, 5 years, and 10 years with interest payment frequency of Annual, Cumulative, or Monthly, as per the selection of the series by the investors. The coupon rates offered by the company range between 7.80% to 8.10%.
CREDIT RATING:
This debt offer is rated "IND/AAA Stable" - by India Ratings and Research, and "ICRA/AAA Stable" - by ICRA Ltd. Ratings issued by India Ratings & Research Private Limited and ICRA Limited are valid as of the date of this Prospectus and will continue to be valid for the life of the instrument unless withdrawn or reviewed. Instruments with this rating are considered to have an adequate degree of safety regarding timely servicing of financial obligations.
Such instruments carry low credit risk. The rating provided by India Ratings & Research Private Limited and ICRA Limited may be suspended, withdrawn, or revised at any time by the assigning rating agency and should be evaluated independently of any other rating. These ratings are not a recommendation to buy, sell, or hold securities and investors should make their own decisions.
FINANCIAL PERFORMANCE:
As of June 30, 2023, its loan book stood at Rs. 85778.5 crore. As of June 30, 2023, its net interest income (including fee income) was Rs. 1433.0 cr. with a net interest margin of 7.0%. Its revenue from operations has increased from Rs. 5511.5 crores for the Financial Year ended 2021 to Rs. 8236.9 crores for the Financial Year ended 2023, and its profit after tax increased from Rs. 768.8 crores for the Financial Year ended 2021 to Rs. 1553.8 cr. as of March 31, 2023. ABFL's loan book grew from Rs. 48618.3 cr. to Rs. 80452.3 cr. as of March 31, 2023, at a CAGR of 28.6%.
For the Q1 of FY24 ended on June 30, 2023, it earned a net profit of Rs. 515.70 cr. on a total income of Rs. 2841.00 cr. Post this issue, ABFL's current debt-equity ratio of 6.2 (as of March 31, 2023) will stand enhanced to 6.4.
Review By Dilip Davda on September 26, 2023
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on the information published here. My reviews do not cover GMP market and operators game plans. Any reader taking decisions based on any information published here does so entirely at their own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
The Aditya Birla Finance NCD September 2023 Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered NCD Analysts tells you if Aditya Birla Finance NCD September 2023 worth investing. The Aditya Birla Finance NCD September 2023 Note sets the NCD expectations in systematic way which tells you if Aditya Birla Finance NCD September 2023 good to buy (good or bad / yes or no). The NCD Forecast tells you weather to invest in Aditya Birla Finance NCD September 2023 by providing NCD recommendations i.e. subscribe, avoid and neutral.
FREE Intraday Trading (Eq, F&O)
Flat ₹20 Per Trade in F&O
|
|
