Shriram Transport Finance Company Limited is proposing a public issue of upto Rs. 700 crore by issuing Secured Redeemable Non-Convertible Debentures (NCDs) of the face value of Rs. 1,000 each.
The company is coming out with its Tranche 3 Issue of NCDs having a base size of Rs. 200 crore with an option to retain additional amount up to Rs. 500 crore from over subscription, if any, aggregating to a Tranche 3 Issue Size of upto Rs. 700 crore.
The Issue will open for subscription on January 07, 2019 and is scheduled to close on January 31, 2019, with an option of early closure, and/or extension, as may be decided by the Board of Directors of the Company or duly constituted committee Debt Issuance Committee- Public NCDs as mentioned in the Tranche 3 Prospectus.
The proposed NCDs under this Issue have been rated ‘CRISIL AA+/Stable’ by CRISIL and ‘IND AA+: Outlook Stable’ by India Ratings and Research. These ratings indicate high degree of safety regarding timely servicing of financial obligations and carrying very low credit risk.
The funds raised through this Issue will be used for onward lending, financing, and for repayment/ prepayment of interest and principal of existing borrowings of the Company and for general corporate purposes.
Options of investment tenors are 3, 5 and 10 years, with monthly, annual & cumulative payment options.
These NCDs, bearing a fixed rate of interest, are being offered under seven different series:
Series I and II are monthly interest payment options, having tenure of 5 years and 10 years respectively, and the monthly Coupon shall be 9.12% p.a. and 9.30% p.a. respectively i.e an annualized yield of 9.50% p.a. and 9.70% p.a. respectively.
Series III, Series IV and Series V, interest payable annually, having tenure of 3 years, 5 years and 10 years, respectively, and the coupon shall be 9.40% p.a., 9.50% p.a. and 9.70% p.a. respectively.
Series VI and VII are cumulative options, having tenure of 3 years and 5 years respectively, where face value and interest accrued are paid at the end of the tenure and will be redeemed at Rs. 1309.66 and Rs. 1574.63 per NCD respectively. Effective yield shall be 9.40% p.a. and 9.50% p.a. respectively.
Additionally, Senior Citizens (initial allottees) under Category III and Category IV are entitled to additional incentive of 0.25% per annum across all series. Accordingly, the amount payable on redemption to such Senior Citizens for NCDs under Series VI and Series VII is Rs. 1,318.67 and Rs. 1,592.70 per NCD respectively.
The NCDs are proposed to be listed on BSE Limited and National Stock Exchange of India Limited and BSE shall be Designated Stock Exchange.
Axis Bank Ltd, A K Capital Services Ltd, Edelweiss Financial Services Ltd, JM Financial Limited, and Trust Investment Advisors Pvt Ltd are the Lead Managers to the Issue. Catalyst Trusteeship Limited is the Debenture Trustee to the Issue, while Integrated Registry Management Services Private Limited is the Registrar to the Issue.
