10.7% Indostar Capital Finance NCD Sep-2024 – Issue Details and Review
Indostar Capital Finance NCD Sep-2024 – Introduction
Indostar Capital Finance Limited has come up with secured NCD bonds which have opened for subscription now. Indostar Capital Finance Limited is a non-banking finance company (NBFC) registered with the Reserve Bank of India as NBFC-ML. The NCD interest rates for Indostar Capital Finance NCD are up to 10.7%. These NCDs have a tenure of 24 months to 60 months, and interest is paid either quarterly, yearly and cumulative. Should you invest in Indostar Capital Finance NCD Sep-2024 issue? What are the risk factors one should consider before investing in such high-risk NCDs? In this article we would do Indostar Capital Finance NCD Sep-2024 Review.
About Indostar Capital Finance Limited
Company is a non-banking finance company (NBFC) registered with the Reserve Bank of India as an NBFC-ML.
They are a professionally managed and institutionally owned company which is primarily engaged in providing secured financing solutions to borrowers across categories: used and new vehicle financing for transporters, affordable home finance solutions to home loan borrowers, loans to SME borrowers and structured term financing solutions to corporates.
Indostar Capital Finance NCD Sep-2024 details
Here are the NCD issue details.
Subscription opening Date
06-Sep-14
Subscription closure Date
19-Sep-24
Issuing Security Name
Indostar Capital Finance Limited
Security Type
Secured, Redeemable, Non-Convertible Debentures (Secured NCDs)
Issue Size (Base)
Rs 150 Crores
Issue Size (Option to retain over subscription)
Rs 150 Crores
Total issue size
Rs 300 Crores
Issue price
Rs 1,000 per bond
Face value
Rs 1,000 per bond
Series
Series I to V
Minimum Lot size
10 bonds and 1 bond there after
Tenure
24, 36, and 60 Months
Interest Payment frequency
Quarterly, Annual and Cumulative
Listing on
Within 6 working days on BSE
Lead Manager
Nuvama Wealth Management Limited
Debenture Trustee/s
IDBI Trusteeship Services Ltd.
Indostar Capital Finance NCD Sep-2024 Coupon Interest rates
As per the Indostar Capital Finance NCD Sep-2024 prospectus, here are the interest rates.
Series
I
II
III
IV
V
Frequency of Interest Payment
Annual
Cumulative
Quarterly
Annual
Annual
Tenure (Months)
24
24
36
36
60
Coupon (% per Annum)
10.50%
NA
10.30%
10.70%
10.50%
Effective Yield (% per Annum)
10.50%
10.50%
10.70%
10.70%
10.49%
Amount on Maturity (In Rs.)
1,000.00
1,221.31
1,000.00
1,000.00
1,000.00
Company Credit Ratings
These NCDs have been rated AA-/ Stable by CARE Ratings. Instruments with this rating are considered to have the highest degree of safety in terms of timely servicing of financial obligations, carrying very low credit risk.
Objects of the Issue
The company intends to use the net proceeds from the NCD issue towards the funding of the following objectives:
Onward lending
General Corporate Purpose
How is the company doing in terms of revenues and profits?
Here are the details of the consolidated financials of the company.
Period Ended
31-Mar-22
31-Mar-23
31-Mar-24
Assets
9,661.5
9,122.2
11,120.7
Revenue
1,174.3
1,179.7
1,397.5
Profit After Tax
-736.5
225.2
115.8
Company Contact Information
Indostar Capital Finance Limited. Off No -301, Wing A, CTS No 477,
Silver Utopia, Chakala Road, Opp Proctor, Opp Proctor and Gamble, Andheri(E), Mumbai – 400 099 Phone: +91 22 4315 7000
Email: investor.relations@indostarcapital.com
Website: https://www.indostarcapital.com/
Reasons to Invest in Indostar Capital Finance NCD Sep-2024
Indostar Capital Finance NCD bonds offer attractive interest rates, allowing investors to earn up to 10.7% per annum.
The company issues secured NCDs, which are safer compared to unsecured NCDs. In the event of the company winding up or shutting down for any reason, secured NCD investors would receive preference in the repayment of capital along with interest, as these NCDs are backed by the company’s assets. Therefore, investing in such secured NCD options is considered safe.
The company holds a good credit rating of AA-/Stable from CARE Ratings.
It provides 5 flexible investment options, allowing investors to choose the one that best suits their preferences.
Risk Factors in Indostar Capital Finance NCD Sep-2024
During FY23 to FY24, though company revenues have increased by 18%, its margins have fallen by 49%. Even in FY22, company has incurred losses and there can be no assurance that company will not incur losses in the future.
Company is affected by volatility in interest rates for both its lending and treasury operations, which could cause its net interest income to vary and consequently affect its profitability.
They have expanded into new lines of business, and if they are unable to successfully run the new businesses profitably, its results of operations and financial condition may be affected
Its Prior Statutory Auditors have provided qualified opinions/ adverse opinions and have highlighted certain emphasis of matters in their audit reports relating to its audited financial statements for the Fiscals 2023 and 2022.
Company, Directors, Promoter and its subsidiary are subject to certain legal proceedings and any adverse decision in such proceedings may have a material adverse effect on its business, financial condition, cash flows and results of operations.
Company has in the past failed to comply with the minimum public shareholding requirements prescribed under the SCRR.
Please refer to the NCD prospectus for a comprehensive list of risk factors.
Indostar Capital Finance NCD Sep-2024 – Should you invest or avoid?
Indostar Capital NCD’s offer good interest rates up to 10.7%. These NCDs are rated as AA-Stable by CARE Ratings which are considered as good ratings.
One should note that credit ratings are subject to change at any time. Company has incurred losses in the past and its margins have declined in CY24 compared to previous year.
Investors can invest in such NCDs if they are willing to consider all these risk factors.
Suresh KP is the Founder of Myinvestmentideas. He is NISM Certified – Investment Adviser and NISM Certified – Research Analyst. He has been analyzing financial markets in the last 20 years.He can be reached at suresh@myinvestmentideas.com Latest posts by Suresh KP (see all)
