Kerala based-Muthoottu Mini Financiers Ltd (MMFL) - a frequent visitor with debt market offers - is coming out with its 5th offer (since February 2014) of Secured Redeemable NCD offer of Rs. 125 crore with a green shoe option to retain 100 per cent oversubscription and thus making total offer size of Rs. 250 crore. The offer opens for subscription on 16.07.15 and will close on or before 14.08.15. It is offering NCD having face value of Rs. 1000 each with coupon rate ranging from 11.00% to 11.50%. Existing debenture holders are offered 0.25% additional coupon rate. These NCDs have tenure of 500 days, 36 months, 45 months and 72 months with Monthly, Annual and Cumulative options. Based on tenure and interest payment options, it gives yield of 11.25% to 12.25%. Application is to be made for a minimum of 10 NCDs (i.e. Rs. 10000) and in multiple of 1 NCD thereon, thereafter.
The company is a registered NBFC and is in the business of Gold loan and is also offers depository participant services as well as money transfer and insurance broking services. Its Net NPAs has gone up from 0.29% in 2012/13 to 1.48% in 2014/15. Its current debt equity ratio of 3.46 times will rise to 4.03 times post this issue. Its net profit is showing declining trends for last three fiscals at Rs. 47.32 crore (FY 2012-13), Rs. 33.66 crore (FY 2013-14) and Rs. 18.48 crore (FY 20214-15).
Issue is lead managed by Vivro Financial Services Pvt Ltd and Link Intime India Pvt Ltd is the registrar to the issue. IL&FS Trust Company Ltd is the debenture trustee. Post allotment, these NCDs will be listed on BSE. Although allotment is available in demat or physical mode, trading will take place only in demat mode.
This debt offer is rated BBB- (Triple B minus) by CARE, indicating moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk as well.
Review By Dilip Davda on December 13, 2019
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
