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India Infoline Housing Finance Ltd (IIHFL), a wholly owned subsidiary of India Infoline Finance Ltd (IIFL). is launching its maiden Home Bond offer on 12.12.13. This is the fourth offer from IIFL group in last three years and all its previous offers met with overwhelming response from investors and were closed earlier than the scheduled closures. This offer instrument is branded as Home Bonds by the company.
IIFL Housing Finance is offering a NCD having face value of Rs. 1000 each with a coupon rate of 11.52% p.a. payable monthly and having tenure of five years. As these NCDs will be listed on BSE and NSE it will provide liquidity at the discretion of the bond holder for early exit.
As these bonds are offering 11.52% p.a. with monthly interest payment, it amounts to annualized yield of 12.15%. Minimum application size is for 10 bonds i.e. Rs. 10000 and in multiples of Rs. 1000 (i.e. 1 bond) thereafter. This offer is made on 'First-cum-First-Served' basis and the offer is for Rs. 250 crore with a green shoe option of retaining another Rs. 250 crore in case of oversubscription and thus the overall size of the offer is Rs. 500 crore.
The NCDs proposed to be issued under the issue have been rated 'CRISIL AA-/Stable' by CRISIL and 'CARE AA-' by CARE indicating that these instrument have a high degree of safety regarding timely servicing of the financial obligations. The offer that opens on 12.12.13 will close on or before 20.12.13 based on response. Axis Capital Ltd, Trust Investment Advisors Pvt. Ltd., India Infoline Ltd and Edelweiss Financial Services Ltd are the lead managers to the issue and RR Investors Capital Services P. Ltd., Karvy Investor Services Ltd and SMC Capitals Ltd are the co-lead managers to the offer. IDBI Trusteeship Services Ltd is the Debenture Trustee and Link Intime India Pvt. Ltd. is the registrar to the issue.
IIHFL has started its operations in 2009 and has posted above 95% and 92% CAGR in top and bottom-line in past three fiscals. The company is mainly engaged in home finance business and having its spread in tire-II and tire III cities and has back up of IIFL's infrastructure spreading over 800 cities across India. The company is offering 11.52% interest on application money from the date of realization and thus, the offer brings rewards from day one. The company will not deduct TDS from the interest payments and thus it will provide better yields to investors.
As market is expecting rate cuts post eased in inflation, this five year term offer with annualized yield of 12.15% looks attractive and investors looking at regular monthly rewards can park their funds in it.
Review By Dilip Davda on December 12, 2019
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 prior to making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at own risk. Investors should bear in mind that any investment in stock markets are subject to unpredictable market related risks. Above information is based on RHP and other documents available as of date coupled with market perception. Author has no plans to invest in this offer.
(SEBI registered Research Analyst-Mumbai).
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.
Email: dilip_davda@rediffmail.com
The India Infoline Housing Finance NCD Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered NCD Analysts tells you if India Infoline Housing Finance NCD worth investing. The India Infoline Housing Finance NCD Note sets the NCD expectations in systematic way which tells you if India Infoline Housing Finance NCD good to buy (good or bad / yes or no). The NCD Forecast tells you weather to invest in India Infoline Housing Finance NCD by providing NCD recommendations i.e. subscribe, avoid and neutral.
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